What if City Council set a target but nobody was willing to meet it? That’s how the budget season played out this year with the School Board exceeding its target by $6.8 million and the City Council missing its goal by $10.6 million.
"We were lied to," said Annabelle Fisher, who attended the final budget session. "They set a target, and they should have stuck to it. They have no backbone."
On Monday night, council members adopted a $519.5 million operating budget for fiscal year 2008, a 5.2-percent increase over the $493.7 budget City Council members voted for last year. To pay for the increase, council members voted to raise the tax rate from 81.5 cents for every $100 of assessed value to 83 cents for every $100 of assessed value. Although the new rate will decrease the average condominium owner’s tax bill by $47, it will increase the average tax bill for owners of single family homes and townhomes by $30. The average assessed value for a single-family home or townhome is $660,866, a decrease of 1.26 percent from last year. The average condo is assessed at $341,008, down 6.39 percent from last year.
"I know that some people feel like our meeting the target is some sort of <i>prima facie</i> evidence of fiscal irresponsibility, but the target was a goal-setting exercise," said Councilman Tim Lovain. "If somehow the whole idea is to just meet the budget targets then you’re just inviting City Council to set up cupcake targets."
Several taxpayers who attended the Monday night session at City Hall said they were disappointed that the elected leaders didn’t follow the lead of City Manager Jim Hartmann. In February, his proposed operating budget met the spending targets set by a resolution passed last November: $353 million for city spending and $156 million for the schools. The first indication that the elected leaders were willing to abandon their own target came on April 10, when the City Council voted to advertise a higher tax rate than expected.
"The spending problems start with the School Board," said restaurateur and Republican stalwart Pat Troy after Monday’s budget vote. "Too much money is going to the schools, and it’s all going to the back of the house."
THE SCHOOL’S BUDGET request created most of the need for discarding the budget targets. In February, the School Board passed a controversial $162.3-million budget in a vote that showed deep divisions within the newly elected board. It narrowly passed with three members voting against it and one member abstaining because she felt that she didn’t have enough information. Claire Eberwein, who cast the abstention, said she felt the administration’s budget document was incomplete and problematic.
"It has a lot of extraneous information that isn’t pertinent to the budget process," said Eberwein after the February meeting. "It is lacking the kind of information that we need to make budget decisions with something other than an axe."
Although the City Council did not fully fund the School Board’s $162.3-million request, its members did allocate $160.2 million — exceeding its own target by $4.7 million. The total operating budget for the schools will increase by 4 percent although school enrollment will decline slightly.
"This is a good compromise," said School Board Chairman Arthur Peabody. "It reflects a balance between living within limited means and meeting the needs of our students."
A COST-OF-LIVING increase for city employees, was another reason the City Council members decided to increase the budget. Although Hartmann’s proposal included no such increase, the City Council decided to add $2.8 million to give city employees a 1.5-percent increase and $2.1 million to give school employees a 1.5-percent increase.
"Last year, we gave our employees a 3-percent COLA but this year we were scheduled to give them no COLA," said Councilwoman Del Pepper. "I really felt like that was leading our employees into a sense of uncertainty in terms of what they could count on from us."
The budget also included several other last-minute changes: $877,000 for eliminating the waiting list for subsidized child day-care; $780,000 for re-instituting red light cameras; $305,000 for increasing salaries in the Sheriff’s Office; $124,000 for environmental studies; and $80,000 for surveying 100-year-old buildings. The adopted budget also sets aside additional amounts from prior year surpluses, including: $400,000 more than originally designated for possible National Harbor related initiatives, $850,000 to build an additional artificial turf playing field, $500,000 for possible increases in mandated foster care and special education costs, and $300,000 for street lights and new refuse cans.
"The target may have been set too low," said Mayor Bill Euille. "But we still have the second lowest tax rate in the region."