Look at that nice, wide gap between General Fund revenues and expenditures during FY2011 and FY2012.
[easychart type=”line” width=”430″ title=”GF Revenues and Expenditures Net of Transfers” groupnames=”Revenues in Millions, Expenditures in Millions” valuenames=”’11,’12, ’13, ’14, ’15, ’16” group1values=”29.2,29.1,28.9,30.7,32.7,33.3″ group2values=”27.2,27.3,27.9,29.1,31.5,32.9″ minaxis=”27.1″]
(All figures are actual as reported in annual city budgets, except FY2015 numbers are the end-of-year budget estimates and FY2016 are, of course, the projected amounts.)
What the gap represented was a huge reset of the operations (General Fund) budget that was accomplished by actively reducing the city’s workforce by some 20% on top of a couple years of attrition.
Mind you, we’d gone a couple rounds of tax and fee hikes by then, but it didn’t matter; city staff calculated at the time that if the reduction in force didn’t happen, we would be $5 million in the hole by the end of FY2011.
What the reset did was to fix the structural budget issue of personnel costs outpacing revenues during the Great Recession and the “flatlined” revenue period following (that DeKalb, by the way, still hasn’t quite overcome). A nice side effect was meeting capital needs. Following the reduction in force, there was enough money to put into the fleet, a new police station, and needed expansion/repairs of the fire stations.
But now, the gap is closing and, once again, money for capital needs has disappeared. And since most of the rise in expenses reflects increases in wages and pension contributions, it’s clear the reset has been squandered by the hiring spree that came after.
[easychart type=”line” width=”430″ title=”GF Revenues and Expenditures Net of Transfers” groupnames=”Revenues in Millions, Expenditures in Millions” valuenames=”’13, ’14, ’15, ’16” group1values=”28.9,30.7,32.7,33.3″ group2values=”27.9,29.1,31.5,32.9″ minaxis=”27.8″]
I have stripped the transfers to and from the General Fund in these charts because their high degree of variability from year to year can be a distraction. But, here they are:
[easychart type=”line” width=”430″ title=”General Fund Transfers in Millions” groupnames=”Revenue Transfers In, Expenditure Transfers Out” valuenames=”’11,’12,’13, ’14, ’15, ’16” group1values=”1.6,2.8,1.7,2,2.2,1.6″ group2values=”4.4,2.6,2.2,2.8,2.5,1.5″ minaxis=”1.5″]
See? Variable. And, sure, some of the transfers went out as infusions to the airport and other objects of controversy, but a lot went to Capital Projects and Fleet and Equipment and Public Safety Building funds, too. This year, however, almost every penny of the out-transfers go to debt service.
Oh, and remember how the city transferred $500,000 of personnel costs to the Water Fund to take care of? Here’s what would have happened to our chart if this amount had stayed in the General Fund:
[easychart type=”line” width=”430″ title=”GF Revenues and Expenditures Net of Transfers” groupnames=”Revenues in Millions, Expenditures in Millions” valuenames=”’13, ’14, ’15, ’16” group1values=”28.9,30.7,32.7,33.3″ group2values=”27.9,29.1,31.5,33.4″ minaxis=”27.8″]
Oops! Bye-bye, “surplus.”
So let’s put this into the context of Monday’s city council meeting. The agenda included approval of a human resources director, a job that was previously handled by the assistant city manager. When I argued against the hire on budget grounds, including the inadequacy of the streets maintenance program, the city manager offered that an adequate street maintenance program would take $9 million a year and this hire would cost almost nothing in comparison so shut up, or something along those lines.
My inner translator says this means our compliant council has not only approved another expensive administrator to our detriment but is fine with city staff holding our crumbling streets hostage to massive tax increases later this year. Meanwhile, they’re still busy feathering their nests.