Disagreements over budget numbers at City Hall

Last week Mayor Dave discussed his budget proposal in a blog post. He explained the need for modest tax increases to make up for the decreased tax receipts this year.

My operating budget proposal came in with an increase in taxes on the average $245,000 house of 3.85%. I understand that’s a tough increase this year even though it’s well below the 15 year average of 4.3%. I’ve asked the City Council to keep the increase below 4%.

However, he emphasized optimism by highlighting some of the advantages to Madison’s fiscal governance:

I’ve asked the Council not to do what I was tempted to do but resisted: dip into our long-term cash reserve or “fund balance.” We’re unique among Wisconsin governments in that we’ve budgeted for a reserve. The City of Madison’s unrestricted cash reserve stands at about $30 million. It’s one of the key reasons that Madison retained its Aaa bond rating this year while Dane County lost its Aaa rating.

However, according to Dean Brasser, the city comptroller, Madison’s situation is not that much better than other cities. I omitted some of the details. Anybody interested in a full copy of the email can contact me.

I enjoyed reading your October 21^st blog post entitled “4 & 0” and agree with virtually everything you said.  I do want to follow up, though, on your statement that, “We’re unique among Wisconsin governments in that we’ve budgeted for a reserve.”

Simply stated, Madison is not unique among Wisconsin governments when it comes to maintaining an adequate “reserve,” or fund balance.  Most other municipal governments try to do so, as well.  It’s a matter of fundamental fiscal responsibility.  Fortunately, the Wisconsin governments that do not keep a reasonable reserve are the ones that are unique.

Our auditors reported that, in their experience, it is common for Wisconsin governments to maintain fund balances from 15% to 25% or higher, depending on local factors and policies.

The City of Madison’s stated available General Fund balance goal is 15% of the subsequent year’s budgeted expenditures.  We went into 2008 with a $31,000,000 available fund balance, about 14.5% of the 2009 budget.  We ended 2008 with a $29,500,000 or 13% fund balance level.  I’m predicting that, with the tough revenue year we’ve had, we will end 2009 with an available fund balance of $26,300,000, or about 11.5% of the 2010 budget.

City budget: Where do we cut?

Tomorrow will be the second of the mayor’s three public hearings on the 2010 operating budget. It will take place at 6 pm at the East District Police Station, at 809 S. Thompson Dr.

City budgets can be interesting – trust me. Those blowhards on CSPAN who bitch and moan about the $47,000 federal money earmarked for a Montana museum celebrating the game of horse shoes might actually be worth a damn in city policy. Because when discussing city budgeting, $47,000 means something. That’s something you’re looking to cut – that might be the salary of one city employee (or two). And just in case you this weather made you forget that you live in Wisconsin, 47 k gets quite a bit of snow of the streets in the winter. But probably not enough.

The only thing that is certain about the budget process this year is that at least politically, the mayor is set on conveying a sense of fiscal prudence. The press releases he’s put out on the budget portray perhaps not a dire situation but a hard one, in which the city will be forced to deliver some tough love to certain agencies. Mayor Dave has not set a concrete goal for cuts, but he has stated that for tax increases to be kept at their 15 year average of 4.3 percent, the city would have to make a 6.2 percent across the board spending cut. As his communications rep emphasized emphasized emphasized, that does not mean the man is setting an ultimatum for city managers – what he will do is ask every agency to submit a list of potential cuts. Supposedly he will then look to that list if he determines cuts necessary.

The mayor’s office was more clear about new projects – they won’t happen. What about that new library? “Well, ok, that might happen, we don’t know yet.” Dave does seem to be into libraries – I’ve got to hand it to the man. During his tenure the city has built two new libraries. Here’s a question: Can a non-UW student get some kind of membership to the UW libraries? Because I must say, it’s going to hurt to live in Madison next year and be deprived of Memorial Library. I’d enthusiastically pay some kind of fee to still have access to it.

Dave has overseen other significant capital investments, including the construction of two new fire stations and a five-year goal to “reduce substandard roads by two-thirds.” Here’s an idea for cutting spending: simply lean on the commission charged with determining what “substandard” roads are and get them to re-evaluate which ones really do need fixing up. After review, all roads in Madison are perfectly standard! But Dave instead settles on the goal of reducing borrowing from the Capital Improvement Plan by 20 percent. Taking such a stab at capital investments might seem like a gutsy move for the mayor who wanted to leave office on a trolley. However, like I said, many of the biggest projects have already been approved or finished. Moreover, the city has gotten some very good deals from the federal government, including 15 additional hybrid buses that are soon to come from the stimulus package.

In a different manner, Mayor Dave is putting his foot down on the operating budget. He vows to not lay off any cops or firefighters, and continues to push public safety as the top priority of the budget. It is inherently a city priority – it and health eat up 42 percent of the budget. The next biggest item is public works, which comes in at 24 percent.

The mayor’s outlined some loose guidelines – how will they be implemented? What does the Council think? Are members going to dive into cost-cutting or are they going to push for more stimulus, heavier borrowing. Is there going to be somebody who’s going to push for cuts in the police department? There are concerns on the left that all other services are getting shafted in favor of an overzealous police department. What do you think?

City budget starts tomorrow (thanks Smathers)

And to maintain services at current levels, the budget will have to grow 5.7 percent. Hmmm…doesn’t that sound suspiciously familiar? Close to the 6.4 percent the state budget grew, due largely to stimulus funds.

The city faces a tough budget with the prospect of layoffs, a wage freeze or service cuts, Cieslewicz has said.

When Mayor Dave starts talking about service cuts, you know the situation is dire. The rumor is the mayor, who puts together the budget, is going to ask for an across the board six percent cut in every department. Much like Doyle put in place a five percent cut in the state budget.

The council will be discussing a variety of other interesting policies tonight, including the approval of a study that will gather data on traffic in the city. That’s all. What it was originally going to be was a study with a goal attached – to reduce car use in the city by 25 percent by 2020. Very ambitious goal, and I have tried to contact both sponsors of the ordinance, Ald. Brian Solomon and Ald. Satya Rhodes-Conway.

Nevertheless, that language was stripped from the policy, and now it’s simply a fact-finding mission. However, according to Bryon Eagon, the Madison Chamber of Commerce has not backed down from its opposition. To a study – on traffic. Slippery slope I guess.

Kristin Czubkowski has a good run-down of other issues coming before the council tonight. The city may very well approve the use of stimulus money to prevent foreclosures and fund employment training.