Houston has its budget proposal for this year, and while it’s no thing of beauty, it’s not got any layoffs, furloughs, or truly drastic cuts in it. The city of Dallas is still working on their budget, and they’re in a worse position than we are.
Dallas officials face a $130 million budget gap for the upcoming fiscal year, a hole which could result in reductions in city services, employee layoffs and new city fees for the second year in a row.
The grim financial forecast by City Manager Mary Suhm, which is being digested by City Council members this weekend, offers yet another gloomy outlook for citizens and for city workers.
“It’s going to be tough,” Suhm said. “It’s not as big a gap as last time, but we’ve already cut a lot of things.”
Last year, the city faced a $190 million shortfall in a $2 billion budget. The council ordered painful service cuts and staff layoffs to close it.
In briefing documents prepared for the council’s study, Suhm has ranked existing city services and identified $50 million in reductions of “lower-priority” services. The gap would then be $81.3 million.
“That’s still not going to make anybody happy,” Suhm said.
Houston’s shortfall was $140 million on a $4.1 billion budget, but only $2 billion of that is the operating budget; it’s not clear to me if the $2 billion figure for Dallas represents the whole enchilada or just its operating expenses. (Rick Casey provides some context in his Wednesday column.) Be that as it may, Houston wasn’t making any huge cuts last year like Dallas was and will have to make again. And Houston is growing, while Dallas is not, meaning that Houston has a better chance of growing out of their revenue shortage once the economy rebounds. Which leaves Dallas with a choice that Houston may or may not have to face.
Mayor Tom Leppert said Saturday he still is against a tax increase to pump new revenue into city coffers.
“We can be hopeful that some things will improve the scenario, but it’s still going to be a tough year,” Leppert said.
But some council members, warned by Suhm for months that the budget picture would be a dark one, have suggested that some form of increase might be preferable to draconian service reductions.
It’s a pretty simple question, isn’t it? What level of service is the government supposed to provide, and how are the citizens supposed to pay for it? Keep in mind that a one-cent increase in the property tax rate means a $20 hike for a house valued at $200,000. That’s not a lot of money for the individual, but it’ll add up to millions for the city. What’s the minimum level of service they want to provide? What’s the minimum we want to provide? That’s the question to ask, and once you’ve answered it, you know what to do. We’ll see how Dallas answers it.
“And Houston is growing, while Dallas is not, meaning that Houston has a better chance of growing out of their revenue shortage once the economy rebounds.”
Yes and no. In terms of physical size, Houston is growing and Dallas is not. Dallas cannot expand. It is almost completely surrounded by other jurisdictions (suburbs). Houston, on the other hand, can continue to annex its growth.
In terms of population growth, even with Dallas’ fixed city limits, it too has shown positive growth.
For comparative purposes:
Dallas: 342 sq mi (land), 1.3 million pop.
DFW: 6.4 milllon pop.
Houston: 579 sq mi (land), 2.2 million pop.
Houston metro: 5.6 million pop.
Dallas is one-fifth of its respective metro population while Houston is nearly two-fifths of its respective metro area. Dallas has much more suburban competition than Houston for better or worse. Oddly enough, suburbs are now seeing their own set of “Dallas problems”. Even Plano has majority-minority schools.
We take for granted in Texas the size of our cities. Chicago and New York, both cities with much larger populations, have much smaller physical footprints than Dallas and Houston. Although land-wise, Dallas has huge sections of under-developed and undeveloped land in its southern sector.
Regarding Dallas’ budget, it is bad. Although one could say a $130 million gap is better than the previous gap of $190 million. There are some services and/or assets Dallas should get rid of. Dallas does not need 6 municipal golf courses. In this day and age of Amazon and Barnes Nobles, does Dallas need 27 public libraries? Public swimming pools are not necessary.
But Dallas’ biggest killer is debt: http://www.angelahunt.com/2009/09/09/bond-sales-current-budget/. We like to think of bonds as of “pay later”, but if you have too many of them it becomes “pay now.”
“Keep in mind that a one-cent increase in the property tax rate means a $20 hike for a house valued at $200,000. That’s not a lot of money for the individual, but it’ll add up to millions for the city.”
El Paso, not exactly a Republican city, one of its school district, Ysleta ISD, voters rejected a tax increase. And now this: http://www.elpasotimes.com/ci_15121998. If El Pasoans are rejecting tax increases, I doubt other places are going to be willingly to support them. Austerity is all the rage.