We said this was gonna be bad, right?
Mayor Sylvester Turner
Houston Mayor Sylvester Turner, facing an economy hammered by the coronavirus pandemic and collapsing oil prices, on Tuesday proposed to close an upcoming budget gap by furloughing about 3,000 municipal workers, deferring all police cadet classes and exhausting the city’s entire $20 million “rainy day” fund.
The proposals are in response to an estimated $169 million revenue shortfall for the fiscal year that begins July 1.
Emptying the rainy day fund “leaves the city in a precarious state for the upcoming hurricane season,” the mayor acknowledged in a message to city council members that accompanied his budget plan. The account holds money in reserve for emergency situations, such as cash flow shortages and major disasters.
The city had just recently replenished the fund after using all $20 million in the wake of Hurricane Harvey. It will not have that option if a storm hits Houston this year.
“The dollars from the economic stabilization fund are gone,” Turner said. “There is no rainy day fund.”
Under Turner’s plan, the city also would draw $83 million from its cash reserves to balance the budget.
The city’s tax- and fee-supported general fund, which covers most basic city operations, would spend $2.53 billion under Turner’s plan, a decrease of about 1 percent from the current budget. Despite the narrow spending cut, the city would be left with a general fund balance that dips below the amount required by city ordinance.
[…]
The proposed spending plan, which is subject to approval by city council, only says that the city would furlough “thousands of municipal employees.” At a news conference Tuesday, Turner said the number would be around 3,000 of the city’s nearly 21,000 employees. The workers would forego 10 days of pay, saving the city roughly $7 million.
Turner did not specify which departments would be required to send workers home without pay, though he said the city would not place anyone on furlough from the police, fire and solid waste management departments.
The city will not implement any cuts until the new fiscal year begins July 1, Turner said.
See here and here for some background. The story mentions the $404 million Houston received in the first cornavirus stimulus package, which it can’t spend on previously budgeted expenses. Maybe the city will be allowed some leeway in that, and maybe the next relief package, which in its current form includes money for cities and states, will arrive in a timely fashion. Mayor Turner says he’d reinstate the police cadet class and un-furlough the other employees as his first priorities if the funding becomes available. In the meantime, this is our reality. All we can do is hang on and hope for the best.
The corona virus package is from federal funding, so there is no easy way to have flexibility. Federal money has all kinds of strings attached to it, and congress is not going to revise their bill appropriating the money. Just like the money for promoting Hass avocados is full of all kinds of restrictions. Special interests at work.
The city is going to be in even worse straits because property values will fall, and thus tax revenue. Will the price of oil ridiculously low, and with the excess construction in the city, and with people thinking that living in a city is not so great when there is a pandemic and everyone is crowded together, there will be a lot of people leaving.
Maybe running a city on the promises of sales taxes is more risky than previously advertised. The city assumes this risk, and realizes that past performances do not guarentee future prospects, kind of a basic in investing.
If there were no revenue cap, the rainy day fund would be a little more robust. The revenue cap has proven its inability to serve the city and needs to be repealed.
Jason,
“everyone crowded together”?
Houston has the largest square mileage footprint of any city in the USA and based on the many articles on sprawl about our city/metropolitan region I’d say the opposite is true. I’d be surprised if Houston is even in the top 300 cities of our country in terms of density. We aren’t crowded.
I doubt people will leave the city if they have a precious job. And if they don’t have a job, not sure the financial resources would be wisely spent for a move to a remote place that doesn’t have employment opportunities.
Not too mention this area has a mayor and county judge who make decisions based on science and data. Get ready for the virus rebounds this summer and fall due to Governor Abbott’s executive orders which are not to be followed per the Governor himself.
“We aren’t crowded” not as long as there is no commuting and those who do not actually live in Houston never concre into Houston.
“I doubt people will leave the city if they have a precious job.” Once again, no commuting no overcrowding. But, how can you leave Houston, if you never even live in Houston? Houston has been very pleasant without the commuters.
“Get ready for the virus rebounds this summer and fall due to Governor Abbott’s executive orders which are not to be followed per the Governor himself.” Please let me know what the hell this statement means in Reader’s Digest form, cause I don’t want to get a headache from trying to translate it into modern English.
David, since you failed to get what you wanted as a firefighter, you sure have become a pain in the behind regarding grammar correcting.
Most people would have no problem understanding what Brad wrote.
“Get ready for the virus rebounds this summer and fall due to Governor Abbott’s executive orders which are not to be followed per the Governor himself.”
Grammatically there is nothing wrong with the above statement.
I understand it to mean, that the virus will reappear this summer and fall.
“Due to Governor Abbott’s executive order which dictate one think but seem to mean something else.” For instance, the woman that was sent to jail because she was charged based on Abbott’s executive order, which he changed after the woman went to jail.
Please, you lost, you do all the hard working firefighters a disservice.
brad, you are right, in that anyone with money in Houston doesn’t take public transportation. Also, Tesla is now moving to Texas. The guy who runs Tesla is all about data and he determined that shutdowns are not needed, and that there ain’t gonna be a rebound. So he’s leaving California.
So is The Mayor finally going to close out all the city ” taxi cab inspectors” that cost taxpayers 25 million dollars or are they being retained for the 25 cabs left in the entire city . = ( 1 million tax dollars per cab)…
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