Point Austin: Beside the Point

While the extraordinary scenes proceed at the convention center and elsewhere throughout town, the City Council remains on its annual budget schedule, with the final readings and votes to proceed this coming Monday through Wednesday (Sept. 12-14). Based on the ongoing public discussions and some scuttlebutt, it looks likely that the council will decide to maintain the current ("nominal") tax rate, which means that with a year's growth and rising property evaluations, the city will take in a bit more money than it did last year, or than it would under City Manager Toby Futrell's proposed compromise rate (plus more on the sales tax side as well). That suggests the council will likely have the funds (about $6 million) to approve most of the staff's recommended "add-backs," ranging from community services to library hours to traffic calming. A council wish list is also circulating with about $3.1 million in additional or preferred services, including the ARCH Downtown, the Austin History Center, the Capital IDEA job training programs, and various social service programs aimed at children and youth.

City employees will likely get a raise package closer to the proposed budget (including a one-time bonus) than the across-the-board increases they were asking for, although the council is discussing a "market adjustment" that would, in their parlance, bring "100% of noncivil service workforce to 50% of market." If that glass sounds half empty, you've heard right. And the council appears unwilling to override the city attorneys' opinion that, under state law, it can't grant consultation rights to city employees via the American Federation of State, County, and Municipal Employees – yet another instance when the "free market" (not to mention the Bill of Rights) applies only to capital.

In better news, last week the firefighters union offered a way to break the apparent impasse in contract negotiations by suggesting a change in staffing policy, allowing the "quint" trucks to be manned by only four firefighters. Mike Martinez of the Austin Association of Professional Firefighters said the idea had been under discussion for some time, but was suggested to the department last week in order to free up personnel to help in the Katrina cleanup (teams are already rotating). Although it's not part of the contract negotiations, over time it would save money – and if the council approves, that savings could be applied to firefighters' pay scales. (At press time, we hadn't yet heard from the Statesman on the firefighters' "sensitivity to the plight of Austin taxpayers.")

Overall, for the city's finances, this is a better year than the last three – but now with a new and uncertain shadow of the expenses associated with the hurricane relief effort. If the federal government fulfills its obligations and its promises, the city should do okay – if not, we could be in for a long, hard year. As of Tuesday, there was nobody from the Federal Emergency Management Agency on the ground in Austin to authorize transitional payments to evacuees – definitely not a good omen.

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The City Budget: Numbers to Watch

Proposed General Fund Budget (est.): $479.7 million

Revenue Sources

Property Taxes: 30%

Sales Taxes: 27%

Transfers (e.g., Austin Energy): 21%

Other (fees, etc.): 22%

Expenditures

Public Safety (police, fire, EMS): 65%

Libraries and Parks: 10%

Health and Human Services: 6%

Neighborhood Planning and Zoning: 3%

Other: 16%

Property Tax Rate

Current (Nominal) Rate: 44.30 cents/$100

City Manager's Proposed Rate: 43.95

Effective Rate (same $$ as FY05): 43.53

Selected Proposed "Add-Backs" From Cuts During Recession (total est. $6-10 million)

City Employee Pay: $1.5 million

Public Safety: $1.4 million

Libraries and Austin History Center: $1.4 million

Social Services: $0.5 million