Now that Mayor Chris Beutler is safely ensconced in his (newly built, at taxpayer expense, I might add) office for four more years, he wasted no time before testing the water to see how a tax increase will play in Lincoln. Right on the primer page, the introduction bemoans the state of the budget (funny we never heard any of this during the campaign) before saying,
This leads to an important question affecting the current fiscal situation: Would Lincolnites be willing to support another increase in taxes to address the city’s budget shortfall? This remains an open yet critical question.
Then you go on to take the survey and learn that if we don’t raise taxes, libraries, swimming pools and even fire stations could close unless the city raises taxes enough to come up with $2.8 million — just to keep funding at current levels.
Beutler has done this survey several years in a row now, and I always find it to be most useful for giving insight into what he’s thinking about doing with his next budget — which will be released this summer. He’s testing the water, and he’s proven to be the type of mayor who will back down if there’s enough controversy. So which of the mayor’s potential budget cuts are likely to stir up controversy?
• Closing the fire station that gets the least calls — which I believe would be in the Airpark area. This surprises me, considering the city is also looking at asking voters to approve a bond issue to build a new fire station.
• Closing the Pioneers Park Nature Center.
• Discontinuing funding for the Bethany, South, and Williams neighborhood branch libraries — although this threat is often wielded, it is seldom delivered. (Can’t tell you how many times Councilman Jonathan Cook has saved the South Library from closure.)
• Cutting the forestry budget by a half million dollars — again. Recall the brouhaha last year when the city forester’s job was effectively bagged.
• Ending funding for Airpark, Ballard, Belmont, Eden and Irvingdale neighborhood pools.
• Cutting $200,000 in programs for seniors, the Retired Volunteer Services Program, Foster Grandparent Program and Senior Companion Program.
• Eliminating the No. 54-Veteran’s Hospital bus route.
Radio talk show host Coby Mach was in a dither yesterday over some of the weird statements in the survey that people were asked to rate your level of agreement with — such as this one:
In these troubled times laws have to be enforced without mercy, especially when dealing with the agitators and revolutionaries who are stirring things up.
and this one:
Atheists and others who have rebelled against the established religions are no doubt every bit as good and virtuous as those who attend church regularly.
And this one:
The self-righteous “forces of law and order” threaten freedom in our country a lot more than most of the groups they claim are “radical” and “godless”.
My personal favorite:
“Thinking is not my idea of fun.”
(You had to think to answer the question.)
However, those questions were part of research being done by the Nebraska Public Policy Center — which conducts the Taking Charge surveys for the city — on public engagement. Yes, your tax dollars paid for the whole survey, but those questions are not really part of it. Still, they were kinda weird, huh?
I think no matter how you slice it, a tax increase cometh to fund the next budget. The budget deficit is just too big ($6.3 million not counting most employee raises and lost state aid) and those pots of money are getting too small to raid (I believe there’s only like $4 million left in the economic development fund that would be about the only pot of money left). Last year, the mayor was able to avoid a tax increase because he really, really didn’t want people to think taxes were being raised as a result of the arena project. Now, that danger has passed (I guess) and he’s been safely re-elected.
I’m not saying it’s right or wrong to increase the tax levy, I’m just saying I told you this was coming…
(Illustration by jscreationzs)
I knew Mayor Chris Beutler’s re-election would guarantee a property tax increase this year, but I didn’t think he’d admit to it so soon after winning his second term.
But there it was, right between the lines on the front page of the LJS:
The mayor, already deep into budget analysis, said he expects to ask for a public discussion on some serious questions:
* Should the city make deep cuts in services or raise more revenue?
* Should the city have a limited roads maintenance and construction program or raise more revenue? This will include a discussion about using more bonds for roads building.
“Raise more revenue” — how does a city raise more revenue? Through fees and taxes. Fees have gone up every year Beutler’s been in office, so that’s a given. And this year I expect Beutler will finally propose a property tax increase. And any discussion about building more roads through bonds means a property tax increase, since that’s how bonds are paid off.
Beutler promised “serious cuts” — but in his first term he backed off pretty quickly at any whiff of public opposition to his cuts. Pool closures, library cuts, even “meter readers” — very rarely did he go through with major cuts. He often brags about cutting 120 city positions — but only a handful of those were pure layoffs.
He said “revenue increases” will be considered. Again, he’s avoiding the word “tax,” but that’s what a “revenue increase” is.
I expect he’ll try to lay a lot of blame on state lawmakers for cutting state aid, but that only accounts for $1.8 million of the problem. Even before that cut became known, the city was projecting a $6.3 million deficit — and that’s not even counting raises that will have to be given to most city employees. The city projects that gap will widen to $19 million in five years, if things don’t change. So we’re sitting in almost the exact same place we were before he was elected to his first term as mayor.
Beutler said in his interview that the city budget was structurally imbalanced even before the recession took hold and he took office. But Beutler ran for his first term on a promise to fix the budget, and didn’t do it.
Here’s what he said in 2007, while campaigning for mayor:
Citing his experience with state budgets as a 24-year lawmaker, he says it’s time to fix a “structural problem” with Lincoln’s budget: City expenditures are outpacing revenue, according to five-year projections. “The City Council and the mayor have let this go on for way too long,” he says, “so that today what you have going on is essentially a mess.” In the short-term, it’s going to take “real cuts” not “one-time” cuts the council and mayor have made recently. He promises not to raise property taxes to make ends meet.
Seems to me, little has changed since then. Here’s what he said this week:
Before he became mayor, city budgets were being plugged with “one-time funds or other manipulations,” he said. Beutler would like to “restore fiscal order” to the budget.
Deja vu, anyone?
Now before you start accusing me of beating up on Beutler too much, know this: I voted for the guy. So did 65 percent of voters on Tuesday. If that isn’t a mandate to make the tough decisions he promised to make four years ago, I don’t know what is.
It’s going to be a rough budget year — again — in Lincoln. And there appears to be no end in sight to Lincoln’s budget problems.
The city has a projected $6.3 million budget shortfall right now, and that’s not taking into account the cost of employee pay raises, the loss of state aid and the potential loss of tax revenue thanks to changes being considered by state lawmakers. The city projects that gap will widen to $19 million in five years, if things don’t change.
I filed an open records request last week, seeking to see budget projections the city generates every year. Before Mayor Chris Beutler took office, the projections were released to the press in December. But Beutler ended the practice, saying it caused undue consternation.
As a candidate for the City Council, I wanted to see the figures so I’d know what this city is facing. Before giving the data to me, the mayor’s chief of staff, Rick Hoppe, gave the budget projections to City Council members after their meeting last night because they don’t appreciate learning such things in the press. Hoppe said one council member immediately told a Journal Star reporter, who then asked for the projections, too, which is why you see the story in the paper today.
The data indicates Lincoln will be facing a budget shortfall of up to $10 million — perhaps the largest ever in the city’s history — when other factors are taken into consideration. City Budget Officer Steve Hubka projects a $6.3 million budget gap will have to be closed this year — and that’s not even taking into account raises for most city employees. He included annual raises for just two unions, since they have contracts for 2011-2012. He did include step raises, which employees get if they’re not at the top of their pay range.
That should add a few million dollars to the bill. In addition, the projection didn’t assume the state would cut state aid by $1.8 million — as is being considered. Lawmakers are also considering taking away Lincoln’s right to levy telecommunications occupation taxes — another big hit if it passes.
Hubka’s projections assume city sales tax revenue will grow at 2 percent per year and property tax value will grow .75 percent for three years and then 1 percent.
Hoppe characterized the situation in LJS as “a little bit worse” than past deficits. But he acknowledged the effect of the city using $4 million in one-time funds last year to bridge the gap. He also mentioned the existence of one discretionary fund, an economic development fund called the Fast Forward Fund, which has more than $6 million in it. So get ready to see that fund disappear.
Lincoln has had to close budget shortfalls every year for at least six years — and this year will be no different. Beutler was elected on a promise to fix the city’s structural budget problems, but this data indicates the problem has only gotten worse, not better.