This Is Your City Budget

Not too long ago, conventional wisdom held that once City Council received the city manager's proposed budget – that annual assessment of local revenues and expenses, timed to coincide with the city of Austin's fiscal year turnover in October – the heavy lifting was largely over, and council would comb through the crumbs come budget adoption. The budget process has become less opaque over the years, with City Manager Marc Ott releasing dozens of metrics, survey results, and spending proposals each season. So why is it that once Ott's proposal was released in late July, council attention turned to keeping two recreation centers open – the cost of which wouldn't even cover half a month of police overtime?

For starters, marking the rec centers for repurposing or closure is a penny-wise, pound-foolish approach that results in sparse savings over community benefit. Shuttering Dottie Jordan Recreation Center in Northeast Austin would result in a savings of $39,726 – a figure that barely qualifies as couch cushion change in an overall budget of $2.8 billion. The city cites lagging afterschool participation hours as one reason behind the change – 34,365 hours annually at comparably sized rec centers, to Dottie Jordan's 14,440 – and also the relative proximity of other recreation centers operated by the Parks and Recreation Department. However, opponents of the proposed change note both those alternate centers (Virginia L. Brown and Barbara Jordan Elementary School) are separated by major highways.

The Austin Recreation Center, located next to House Park near 12th Street and Lamar, is proposed to transition from its current use, where it's often leased out to partners like Austin Community College, to a fully leased venue; while specific tenants aren't yet nailed down, longtime tenant Jazzercise and potential Roller Derby newcomers had expressed interest in partnering. Aside from saving roughly $250,000, the city hopes to earn $100,000 in revenues from leasing out the facility.

Still, in the context of a municipal budget for a city doing financially better than most, it looks like council will find the extra funding to keep both centers open. Council Member Mike Martinez named preserving the two centers as a priority, noting "for the minor amount in the overall budget that's projected to be saved, [closing] would create a lot of hardship to the community that uses those rec centers." Mayor Pro Tem Sheryl Cole also proposes that council "add back some sums for the unmet needs in [PARD], especially Dottie Jordan and the Austin Recreation Center .... We can find it if we need to."

While council will likely scrub the budget to free up additional funds, the conversation doesn't end with keeping two rec centers afloat. Despite Austin's strong stance during the seemingly endless recession, cuts at the state and federal level – informed by the plutocratic austerity craze sending America and the Eurozone to the brink of a double dip, if not beyond – have upended funds the city's depended on and lent further scrutiny to every dollar spent.

Taken for Granted

"We see this impact problem playing out on the federal level and at the state level," noted Cole at a recent budget work session. "[We have] the refusal to fund social service contracts, and then we have an expense way above what we can pay for long-term." Federal and state funding reductions have left the city with huge gaps to fill. Neighborhood Hous­ing and Community Development – the department tasked with creating and preserving affordable housing in Austin – was hit especially hard, as its federal Community Development Block Grant was cut by $1.3 million, and Housing and Urban Develop­ment's HOME program was scaled back by $500,000. The combination led to the termination of 11 unfilled positions. Health and Human Services saw grants shrink by $700,000, meaning reduced hours at neighborhood health centers. Libraries are seeing grants reduced by $900,000 before they disappear altogether next fiscal year. The results are plainly displayed in the reduced operating hours being floated for Faulk Central Library, which would slice out eight hours a week from its regular schedule.

NHCD was able to stanch the bleeding, partially with a $500,000 infusion from the city's Sustainability Fund, a reserve established in 2001 to advance environmental and economic equity. "The Sustainability Fund did have an adequate ending balance to do that transfer this year," budget officer Ed Van Eenoo told council in his presentation. "Certainly the revenues flowing into the Sustainability Fund are not sufficient to continue this level of outflow into the future. As we move ahead, we will find alternative funding sources or make program reductions in these areas."

A Smarter Cop Shop?

With every dollar the city spends de-leveraged, the costs of certain programs are receiving greater scrutiny – starting with Public Safety spending on police and the semisacrosanct "two cops per 1,000 citizens" directive the city has operated under for years. Bill Spelman made some minor waves when, at a recent session, he suggested the city revisit the policy, asking, "Is there any other place in this budget where we have mandated a level of service staffing that has to be dead-on?" He went on: "We might wish to revisit that policy to reallocate some of that General Fund, for example, from sworn officers to civilians, given the widespread understanding that we're having trouble answering all our 911 calls. ... It seems to me this might be a good time for us to revisit that policy and come up with a new one which provides a little additional flexibility."

It's not the first time Spelman has broached the issue. As he told the Chronicle following the adoption of last year's budget, "We've taken all the new money we've gotten from property taxes, sales taxes, and what have you, and put it all into public safety." His current call is for the Austin Police Department to spend smarter: instead of reflexively adding more sworn personnel to meet the two-per-1,000 ratio, assess how police services can best serve the community by adding nonuniformed members in support positions. "A big piece of the budget is being determined by a mechanistic formula rather than an examination of our needs," he says.

It's uncertain whether Spelman's call will get much traction. Mayor Lee Leffingwell's defended the staffing, saying, "The bar would be very high for me to want to even consider revisiting that ratio." Martinez says he's willing to at least discuss the issue. "If [Spelman's] teeing it up so we can have this conversation through the next year – then yeah, I think we need to have that conversation, and I'm fine with that. ... But I don't think you can just lay it on the table and say, 'There's no justification for two per 1,000, and we need to stop doing it'." Cole went a step further, suggesting it's time for a more thorough examination of the police ratio: "I think that that probably needs a deeper policy discussion," but it is "a conversation we have yet to have." And on the campaign trail, new Council Member Kathie Tovo indicated a willingness to think differently about police staffing. "The continuing growth of the public safety budget is limiting the ability of the city to deliver other services that are important to maintaining a high quality of life," she said.

"I think people understand the problem that I'm raising," Spelman says. "Funda­ment­ally, the problem is you have one piece of a budget driven by a formula and the rest is driven by a more amorphous, holistic view of citizen need. In that scenario, the formula is gonna win every time."

The WTP4 Treatment

It's worth noting that, as of this writing, council has had approximately one week to examine estimates of the cost to suspend construction of Water Treatment Plant No. 4 for either five or 10 years. While opinion's still divided on whether the plant is a needed infrastructure upgrade that's too far along in construction to stop or an environmentally irresponsible money pit diverting conservation dollars, it's clearly affecting utility fees.

Austin Water has projected a 61.2% total rate increase over the next five years; over that period, utility officials say only 8.6% of that goes to WTP4-related costs. Regardless, the largest rate increase is scheduled for this coming budget year, a $8.33 increase for average water users. The largest component of that increase is a $6 "sustainability fee" that's drawn public ire, including from many WTP4 opponents. "There is substantial concern that the sustainability fee is a) misnamed and b) larger than expected or necessary," says Spelman, predicting further council discussion on the topic.

Solid Waste Services and Austin Energy haven't drawn as much attention with their rates holding steady for now; electricity rate increases – the first in 15 years – are coming early next calendar year once AE completes its cost-of-service study. But the specter of WTP4 will doubtlessly loom large over Austin Water as the utility seeks to reconcile conservation with economic solvency.

Hashing It Out

Addressing the perennial public safety fix, collapsing grant assistance, and the city's utility departments while meeting citizen needs – these will be a few of the items on council members' minds when they adopt a budget, starting Sept. 12. While council has traditionally scheduled three days for discussion and adoption, it's usually finished in less than three hours. That may not be the case this year, Martinez says. "This time you're gonna see us sit there maybe one, maybe two, maybe three days – sitting down and hashing out what should be amended, what should be added back. ... I think it's different because of the open meetings issues that we've been through this last year, where we don't meet and discuss items [one on one] prior to open sessions any longer, out of an abundance of caution. And obviously I don't think that's unhealthy."

At left, we've noted some of the major changes to transpire between the budget's initial springtime estimate and City Manager Ott's latest proposal. Take a look, and you'll agree – council will certainly have enough to discuss.

Money In, Money Out

The city's General Fund, money used to fund city services, stands at $690.2 million in revenues and expenses.

Per usual, property taxes make up the bulk of revenues; expenses-wise, Public Safety (police, fire, and EMS) again takes up two-thirds of General Fund revenue, prompting some on council to question the axiomatic directive of "two officers per 1,000 citizens."

New Spending ($2.9 Million, and Growing)

• Public Safety: 49 new police officers to maintain the city's 2-per-1,000-citizens ratio ($2.3 million for six months in FY 12 budget; cost grows to $4 million annually in 2013 and beyond), 18 new paramedics ($250,000 for three months in FY 12 budget; cost grows to $890,000 annually in 2013 and beyond)

• Austin Animal Center: Extra funds to implement Animal Services' live outcomes ("no-kill") plan ($300,000)

Cuts: $6.9 Million From Departmental Budgets

• Reduce Faulk Central Library hours ($102,000)

• Close Balcones and Dick Nichols pools during winter months ($243,000)

• Reduce number of playground sites with supervised programming from 27 to 10 ($184,000)

• Lease out or potentially shutter Dottie Jordan Recreation Center ($40,000), Austin Recreation Center ($250,000)

• Reduce unallocated funding for social service contracts ($200,000)

• Reduce APD overtime ($1 million)

Monthly Taxes and Fees

• Property Tax: 2.5-cent increase in tax rate, from $0.4571 to $0.4823 per $100 valuation, which given dropping valuations amounts to a $2.97 monthly increase to $73.24 on a median-priced home ($182,228)

• Austin Energy: $10.91 increase to $102.53 (pending City Council approval of AE's rate increase next year; a 12% increase is used for this estimate)

• Austin Water: $8.33 increase to $73.21

• Solid Waste Services: Unchanged at $23.75 (for a 64-gallon trash cart)

• Public Works: Unchanged at $7.29

• Watershed Protection: Unchanged at $7.75

Total increase of $22.21 (8.36%) to $287.77