After Monday night’s council meeting, one of the residents told me that he was looking forward to my recap and could I please include pictures of circus animals. I couldn’t think of any response other than ‘how the heck do I write about this?’ But alas, I will try and as usual, go in the order of the agenda. BTW, you can now listen to the meetings online buy clicking on the little speaker icon on the meetings page.
Special Presentations
City Administrator Stall went over the proposed budget. There isn’t anything that I can add to this that I didn’t write about earlier. The only thing that I will say is that I was disappointed that Stall presented it because it is Mayor Webber’s budget. He should have been the one explaining why he wants to deficit spend. And I did say that in the meeting.
Administrative Reports
Stall described a boating accident that resulted in a death. Shoreacres PD responded to the call at the Houston Yacht Club.
Business
8.2 – this agenda item is something that Alderman Nancy Schnell has been working on for a couple of months. In a nutshell, the city currently has, by code, one building inspector. Not a company, an individual. So, if he isn’t available when your contractor is ready to move to the next step, you have to wait. Schnell’s ordinance starts the process to expand that list. Although citizen Dana Woodruff spoke in opposition to it, it passed the council unanimously.
8.3 – Alderman Schnell volunteered to be the representative to the Houston-Galveston Area Council. Alderman Mike Wheeler volunteered to be the alternate.
8.4 – Budget review
Here is where the real ‘fun’ started. I’d suggest that you listen to the meeting if you want to get a real flavor of what happened. In the end, another budget workshop was scheduled for Monday, September 30th.
Here are a few of the things that got my attention.
Mayor Webber wanted to go line item by line item but that proved unworkable and tedious. In fact, I don’t recall that they ever got off the first line item. Alderman Schnell wanted to look at the big picture and started out by saying we needed to cut the city secretary to 29 hours a week and that we couldn’t afford the current city administrator.
Citizen and former alderman Dana Woodruff gave a spirited defense of Mr. Stall, noting the amount of funds that he had pulled in via grants after Hurricane Ike and the progress made on rebuilding streets, water infrastructure, and drainage ditches.
Citizen Ron Hoskins stated that he had pulled budget numbers from the city website and noted the large increases in spending since 2008. He then proposed returning to the budget of 2008. That isn’t a bad idea if you ask me. I’d rather have zero-based budgeting but it is probably too late in the process for that to happen on this budget.
Then someone mentioned that Stall himself had said that the city would be broke in two years. Stall objected and asked the mayor if he could clarify what he said. In addition, he objected to “someone” (yours truly) using budget numbers and not actual numbers when analyzing the city’s financial situation. Imagine that, using budgets that council approved to analyze the direction of the city. Shame on me.
Stall continued, saying that we haven’t thrown the money away, we’ve invested in assets and rebuilding infrastructure. I’ll let you listen because I’m fair that way. I am also posting the charts he used to “prove” that I was wrong.
This is the way he described it to me via email:
At the instant the budget year ends all there are fund balances that include cash, bank balances, TexPool and the Certificates of Deposit. For that instant there is no budget and no reserve, just fund balances. In the next instant the new budget goes in to effect and those funds that are not budgeted for expenditure become the reserve (unbudgeted cash reserves).
The numbers on the chart are the fund balances at the end of one budget as the next is ready to start.
Fair enough. I stated that the city’s reserves had dropped 30.4{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} over the past six years, including the current year through August 31. Stall’s combined chart also uses six years but he goes back to a year before the hurricane and doesn’t include the current year, which isn’t exactly apples to apples but I’m fair, so I’ll accept it. Using his method, the city’s combined funds have only dropped 28.1{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}. Do you think that is rosy?
Now, about his ‘clarification’. I’ve transcribed what he said at that budget workshop but please, listen for yourself to see if I described it accurately.
If you look at the big picture and you put both of the funds together, you can see that the combined growth of the budgets is 3.9{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} and you can see that the contribution from the reserve fund is $846,000. As we look forward, that is not a sustainable number even if we come in under budget. We have in reserve just slightly more than $1.7 million, so if we were to spend all of the money in this budget, which we historically have not done, but if we were, and if our revenues were to come in at or below, we would only have one more year that we could have this kind of deficits and fund it from the reserves.
I absolutely agree with him that this is not a sustainable number. I completely disagree that we should budget spending more than we know we will spend just so that we can say that we are ‘under’ budget. This type of budgeting leads to terrible decisions, such as the witch-hunt against the current police chief, for which the council approved spending $15,000. One of the council members told me that he voted for it because they didn’t have to go out and find new money, they just used money that was budgeted. I’m sorry but budgeted or not, that $15,000 came straight out of the reserves. No legitimate business in the US would put up with this kind of budgeting.
Stall and I are like oil and water on most things. As Chair of the Fayette County Republican Party, he works inside the system. As a political blogger dealing mainly with Republicans, I work outside it. He uses Canon, I use Nikon. But I respect his wealth of knowledge and have stood in front of council many times and said that we are fortunate to have him as our city administrator. Whatever comes out of the budget talks, my opinion of him will not change.
Commentary
There were other highlights but too many to mention. I do like the aggressiveness that Schnell and Alderman Steve Jones are displaying in insisting that the budget be balanced. I was disappointed that Mayor and a couple of others stated that they were not interested in affecting the livelihoods of city employees. I’m sorry but this is the City of Shoreacres, not the Texas Workforce Commission. As Mr. Hoskins stated, sometimes you have to cut a few jobs to protect the majority of the jobs. No one said being on council would be a walk in the park – we need people that are willing to make decisions to protect the future of the city.
Here is my suggestion to each council member. Show up at the budget workshop Monday night with your own budget. Present it to the other members. This will be far less time consuming than going line by line. If you don’t have the time to come up with your own budget, do as Mr. Hoskins suggested and present the 2008 budget as is. Have Mr. Stall put your proposed budget on the city website Friday or Saturday so that other council members and citizens could review it before the workshop. Citizens will not have input at the meeting because it is a workshop but they could contact council members and let them know that they approve or disapprove of their proposals. Heck, I’ll be happy to highlight the proposals here. Anything to avoid another ‘circus’ like we saw Monday night.
We have serious budget problems. But we also have plenty of knowledge and creativity to overcome them. Let’s Git-R-Done!
Good for the city council for putting the meeting audio online where everyone can listen to it.
I do believe the city is wasting lot of money. You have and intern chief in the police department that was brought in to do investigation, which should of been handle by the city internally.I hear there lot of money in warrants that not being collected. D.O.T program love it are hate it, it did and can produce revenue, bring it back. Every citizens deserves quality service from there city, sometimes we have to look and see if were getting to top heavy and bloated with expense we don’t need.I don’t live in Shoreacres, but the city is like a second home to me, great people, great community.
Good writeup!
To give you a comparison that I used on Monday night, here is the table:
Personnel Costs 2008 Budget 2013 Proposed Budget actual (+/-) {997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} increase
Administration $151,798.00 $235,742.00 $83,944.00 55.30{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Parks $15,203.00 $56,468.00 $41,265.00 271.43{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Public Works $42,020.00 $102,245.00 $60,225.00 143.32{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Sewer $44,994.00 $56,828.00 $11,834.00 26.30{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Water $115,159.00 $129,153.00 $13,994.00 12.15{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Police $366,605.00 $489,802.00 $123,197.00 33.60{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Municipal Court $47,134.00 $59,780.00 $12,646.00 26.83{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Totals $782,913.00 $1,130,018.00 $347,105.00 44.34{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
I find the approach of going line by line and debating each line item to be unproductive. Too much time gets focused on low cost expenditures and misses the big picture. That is like going through a family budget and limiting showers to once a week to save on the water bill, while ignoring the bigger ticket items of filet mignon, Dom Perion, and caviar.
While there are other areas to cut the budget, the big ticket item is personnel expenses, which is what the above information is about, comparing 2008 to proposed 2013/14.
The 271.43{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} increase for Parks personnel costs really gets me. What does this employee do? We know he doesn’t mow city lawns because there is $28,000 budgeted for a contractor to do that. He also is budgeted for certification pay, but there are no applicable certifications for parks personnel.
The bottom line is that our biggest increase is in city personnel costs from 2008 to 2013. That is where the council needs to find the cuts.
Our property tax values from 2008 was a bit less than $95M. Projected for this year is $91M. Yet the actual tax rate in 2008 was .726891 per $100, while 2012/14 is scheduled at .844381 per $100. With the proper budget cuts, the city could be at a tax rate of .75 per $100 or less.
Maybe this is easier to read:
Personnel Costs_______2008 Budget_____2013 Proposed Budget___actual(+/-)___{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} increase
Administration_______$151,798.00_____$235,742.00____________$83,944.00____55.30{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Parks_________________$15,203.00______$56,468.00____________$41,265.00___271.43{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Public Works__________$42,020.00_____$102,245.00____________$60,225.00___143.32{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Sewer_________________$44,994.00______$56,828.00____________$11,834.00____26.30{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Water________________$115,159.00_____$129,153.00____________$13,994.00____12.15{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Police_______________$366,605.00_____$489,802.00___________$123,197.00____33.60{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Municipal Court_______$47,134.00______$59,780.00____________$12,646.00____26.83{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
Totals________________$782,913.00___$1,130,018.00___________$347,105.00____44.34{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986}
I wasn’t able to attend the last meeting but listened to it. I do want it known that we cannot continue on this course of spending oversight of our means. we cannot keep pulling from reserves to balance the budget that which is happening now. We will be bankrupt as a city in the next couple of years if not sooner. This is not Washington D.C. where we can print money and we are still in a mess as a country. That being said, we have to cut where it might hurt and that is in personnel. I protested the raises given last…………over the top considering the times and circumstances . We were told the reason being that we need to keep highly qualified personnel……..then why are we in the mess we are in? We are a small town with no tax base except primarily residential which has dropped contrary to what I was told and knew. Ike hurt us terribly but we are top heavy and that needs to be addressed. I remember the time when we had no city administration and no public works director……we did just fine.
The numbers that you see in the September 23rd meeting article under net changes of various funds are misleading. For example look at one line item:
The posting for 2012 General Fund shows an ending balance (9-30-12) of $1,622,886 leaving a credit of $86,843. In reality, a grant amounting to $954,151 was comingled in the $1,622,886 because it was considered a “receivable” (owed to us by GLO upon completion of a project). This grant money will eventually be issued to the City when the project is completed, then it is disbursed to the contractor. If you excluded this grant funding, our real cash balance would equal the amount of cash assets on hand less what we owe on 9-30th. In other words the fund balance would be $628,735 not $1,622,886. And that is frightening. You might want to review the Balance Sheet in the September 30, 2012 Audit Report. Audit Reports can be found in the City’s website under Financial Information.
I am not the type of person who is prone to tell you “I told you so” however I will only harken back to a time in the past, I served 5 terms as a Council member in
Shoreacres from the 60’s until I resigned after Ike and moved to East Texas. I always had as a plank in my platform that we should seek consolidation with LaPorte. We missed this opportunity when BMUD did consolidate and Shoreacres voted it down. I even ran on a consolidation slate and we lost. I always said that we could not face the inevitable impact of a major storm without serious consequences. Give the devil his due, if it wan’t for David Stall Shoreacres would not have survived as well as it did after Ike. I always believed that the majority of Shoreacres residents would have favored consolidation because I was always the leading candidate in votes received. But you know how the rumor mill distorts reality.
Great to hear from you Mr. Gomer! I hope that all is well. The city misses you!
Thanks for your comments. We are doing well in th this small country town of Wells,Tx.
Miss everyone but Ike made up our mind to leave Shoreacres and down-size up here. Glad you are covering the Shoreacres mess Shoreacres has always been an impossible dream and now it has become a nightmare.
Sincerely,
Joe Gomer