Monday, August 24, 2009

Cooper City Budget Issues...continued

The essence of a good Government is that they are prepared to make difficult decisions to achieve long-term prosperity. Given the recession, one would think that the city manager's proposed 2010 budget would include a reduction in city generated taxes and fees, and that he would be very prudent regarding discretionary expenditures. We will see that this is not the case.

What we have is a national, state and county/local government that is completely out of control regarding the recent expenditures of taxpayer dollars. True leaders in our city should consist of private business owners, not ‘go-along-to-get-along’ politicians, who will unfortunately approve this upcoming budget because they just don't want to challeng the 'status quo', or they don't understand what it is we are all facing. The commission should consist of the same type of business oriented leaders that understand that during a recession you don't charge your customers more money just because you refuse to make the cuts that are necessary and expected when revenues are down. Some on the commission just don't seem to get it. I guess it's because it is not their money. If they disagree, rather than attack me, I say "put your money where your mouth is, and reduce this budget drastically!".

As public officials, we are in a position of Public Trust and as such, we have a sole duty to provide honest services while in elected office and to do our absolute best to assure absolute public confidence in the government. This has simply not been the case in our beautiful city since even before I was elected. The public’s trust is imperative and is determined by civic values such as open government, integrity and professionalism. Although the integrity of our Mayor and some on the commission has been sorely lacking, I won't discuss that issue here, as it is a subject for another upcoming article.

Schemes to defraud citizens of an intangible right to honest government services and irrational spending in a recession by public officials runs rampant at all levels and must be stopped. It's only the beginning…Government needs to completely slash their budgets like the rest of us have had to do, but this should not come as a surprise to anyone who understands the problem.

Our budget process is in full swing and as such, I recently requested answers from our new City Manager to some questions that I had, and some that I was asked by my constituents, such as "What is your plan to control overall spending? I'd like to see you propose an across the board 10% cut in operating costs on paper. Easily done...Send me a proposal." No reasonable response or attempt to control spending has been given.

I also asked "Are there any pay raises scheduled for employees?" The response was that a '2.5% merit increase has been budgeted based on satisfactory performance. A lump sum longevity increase of $1,500 has been budgeted for 34 employees who are at the top of their pay range.' Although no Cost Of Living Allowance was budgeted this year, my concern is that if the money given is a merit raise, why is it given to 'satisfactory' employess, those who are expected to do their jobs and do it well?

The proposed 2010 budget reflects only a a 1% reduction in discretionary operating costs in the General Fund (see page 11 of the budget) yet the proposed 2010 budget shows a 5% increase. The 2008-09 budget showed an 18% increase on top of a 5% police increase for a total of 23%. To reach a 10% reduction level in discretionary or operating costs spending would possibly require an additional $867,000 and may have service level impacts. What services? Who knows, but any cuts would certainly not impact the 'feel good' programs liked by the majority on the Commission. Instead, any cuts proposed and subsequently implemented may indeed impact essential services that are there for health, safety and welfare reasons.

At the August 11th workshop we discussed, at length, whether to continue funding the Broward County Transit program rather than discuss much more important items such as the extreme pension fund losses and how to ensure that the pension fund is fully funded. If this is the desire of the Commission to review non-priorities and waste excessive amounts of time on mandatory and required city services, we would have to establish additional workshops to review the budget proposal and what other 'services' would be reduced. The problem is, we are already looking at September along with having no mid-year budget review of '09.

An ominous storm cloud is gathering monthly as governments try to pay for the lucrative pension promises made to their employees. And these clouds are not just over a few city skies. They are virtually everywhere. Government employee pension funds across the nation are in a crisis. The Cooper City Police and Firefighters' pension funds alone had net losses of $2.1 million and $1.3 million respectively for FY 2007-08. However, BSO, not the City, is responsible for any losses as part of our merger agreement. You still pay for that, so don't be mislead. The Cooper City General Employees Pension Fund had a net loss of $1.9 million, on top of a $4 million loss. This is clearly a national, systemic problem. In fact, American taxpayers are exposed to a total of more than $350 billion in combined unfunded government pension liabilities just this year alone.

Commissioners still need to pull out their red pens. It's clear that the majority's budget choices reflect personalities, non-priorities and past incompetent budget behavior. Just look at the steep climb in spending per the Finance Director's charts! Spending such as $12K for Commission travel, and city attorney costs of almost $400,000 when the reason given by Commissioner De Jesus to hire long time friend of the Mayor, and neighbor to Commissioner Curran was “to save money” is disgraceful, and disingenuous.

I feel that our local government must change their ‘Spend it or lose it’ attitude and they must immediately tighten their belt like all of us have had to do in the recent past. The question that all of us should be asking is “What does this proposed 2010 budget specifically do?” We just don’t know. There is a severe lack of backup material and an apparent lack of fiscal responsibility in the air.

The departmental and fund comparisons are budget to budget, rather than the 2010 proposed budget compared to actual numbers for 2007 and 2008, and the easily, but not provided projected year-ending 2009. What this means is that we are comparing estimated 2010 to estimates in the budgets for 2007, 2008 and 2009. This is a poor and misleading practice as there is no reason to use the estimates for 2007 and 2008 because we have the actual results for 2007 and 2008.

Some commissioners and residents think that this budget proposal is well done and a fantastic presentation. I disagree. It is almost a trivial exercise to provide a very close estimate for how 2009 will end up. As of now, the staff should have 10 months of 2009 numbers already on the books. They know their run-rate numbers for Year-To-Date. I think that the City Manager should have these numbers, and he should provide them so that we can estimate our budget a little better than trying to make a 'best guess' at it.

It is standard management practice to request budget and expense estimates from departments all throughout American businesses. The City knows, or should know almost to the dollar, what each department expects to spend vs. the run rates through 9/30/09. This would be a much better and much more accurate method than using budget estimates made as much as a year ago. The Manager gave us numbers that he very possibly knows are incorrect as to the real world (the 2007 and 2008 budget figures) and, so far, he refuses to estimate the year-end 2009 numbers when he easily can do so.

So, in essence, the commission and the public are given comparisons that mean little to nothing in terms of actual budget experiences, facts and trends. Somehow or another, we all need to be comparing actual numbers to requested departmental budgets as much as possible, otherwise, we are just comparing one guess to another.

I suggest that all of you ask your Commissioners and the City Manager to re-submit his comparisons using actual '07 and '08 numbers, estimated year-end '09 actuals and proposed '10 budget numbers. I have done so with no response, which is nonfeasance in my humble opinion. I am trying to obtain for my constituents, a much more responsible budget for 2010 that is more in line with the economic recession, current and future hardships being faced by many, many Cooper City residents. As such, it's very obvious we are not hurting for money, but we are indeed spending way too much.

A 'balanced budget' is simply not my idea of prosperity. Costs of Police & Fire are up, along with costs associated with our utilities infrastructure. We must make further deep cuts regarding waste and unnecessary spending in the proposed upcoming budget in order to put even more tax dollars back into the pockets of our families, businesses and employees. We must drastically reduce the extreme operating costs of our local government and increase its level of customer service. No one person or party can claim to have all of the answers. In the end we all must work together, residents and this administration alike, and the people must get what they have long demanded government to do...Be fiscally responsible with their hard earned money.

Another thing that is critical, is that government must focus on results, not politics nor process. And I know that if we all work together, we can succeed. I invite all of you to the budget workshops and public hearings (posted here) and I implore you to give valuable and much anticipated input throughout the entire budget approval process.

Let me know what you think our budget priorities should be. The Commission cannot satisfy everyone’s concerns, especially in this economic recession, but your concerns on what should and should not be spent and/or cut are very important issues to me. Just as important are your concerns of where local government waste or inefficiencies are occurring. If you have any concerns to convey toward your elected officials, please be as specific as possible. Comments such as “Don’t hurt the bus program” are not going to give us specifics on what to propose in our upcoming budget meetings.

At the heart of the local government budget and pension crisis is a set of incentives that encourages elected officials to make decisions in which they don't have to bear the consequences for. Since your elected city and county officials will not immediately bear the costs and consequences of the budget and employee benefit increases that they are responsible for and supported, there is no incentive for them to show future fiscal responsibility and restraint.

At the end of the day what we should be doing is simply our job...public service. In this process, we've got to ensure that our tax dollars are spent very wisely and only on the bare necessities...needs, not wants. Budgets should reflect the desires and relevant issues of the community, not that of those in power. As I stated in my public commentary, politics must be completely eliminated from the budget process. We need open, honest government in Cooper City. We require and demand a Commission that works together for the will of The People!

As long as the Mayor and individual Commisisoners remember that we all serve The People, and we work together to do what is right, putting aside our continually ensnaring and petty personal, negative and political differences, the goals of prosperity that all of us share and dream of can be achieved right now. A house divided cannot stand. In public service, it is always important to remember, we serve our boss “We The People”.

Contact your Commission members and city staff, and demand that they cut discretionary spending for this upcoming budget. Otherwise, your taxes will continue to increase...
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