Showing posts with label Municipal Budgets. Show all posts
Showing posts with label Municipal Budgets. Show all posts

Wednesday, June 9, 2010

Vicious Cycle

While budget infernos sweep state and local budgets, government bureaucrats fiddle away at deficits by making minor cuts and taking the easy road of tax increases. I’ve used the microcosm of the local Palm Beach County budget activity to make this point before, as it probably reflects what is going on in some municipal and state finances throughout the United States. PBC’s “recommended” 13.4% increase in property tax rate is designed to “make up” lost revenue” from falling property values. A future stream of required higher tax payments just devalues property further, begetting yet more future increases.

On the other side of the ledger, the “tough” spending cuts include cremating indigents when they die, rather than burying them, “saving” $100,000 (this, mind you, in a budget of some four billion dollars). Other cuts, of course, are aimed at the people who need help the most. Meanwhile, more than $1 billion is earmarked for “general government, interfund transfers, other, and internal services.” Make systemic changes to the way the County operates? Not a chance.

Saturday, May 30, 2009

Prelude to Panic

That’s the headline from today’s Palm Beach Post: Prelude to panic: Tax rolls plummet.
Surprise, surprise? More antidotal evidence that the recession is indeed the “Great Recession” and local government is out to lunch “with countywide values lower than feared.” Where have they been during the past year while the clock was ticking towards the end of their June 30 fiscal year and the beginning of the new one? Foreclosures and rising unemployment should have spelled out reality. All one needs to do is to drive through many of the neighborhoods in Palm Beach County where “For Sale” signs are interspersed with euphemistic “For Rent” signs.

Here are some bullet points:

* Property Appraiser Gary Nikolits had been expecting “the quickest free fall since the Great Depression” but his estimate of a 12% decline has now been revised to 13.5%

* Taxable countywide property has declined to $138 billion from $159.6 billion last year with 38 cities, towns, and villages having larger percentage declines

* Given the 13.5% decline in values, county administrators proposed a 13.5% tax rate increase (as well as laying off 175 workers, an undisclosed percentage of total employees)!

When times were “good” (fictitiously good, that is), our town in PBC was eager to spend. $Millions went into the ”beautification” of a street which might have been more beautiful if some of the homes were updated, but as the municipality can not just hand out money to homeowners (only the federal government can do that), they constructed little islands in the middle of the road and planted vegetation. Much of this beautification is now gone but the islands remain, constricting traffic and leading to a reduction in the speed limit: so much for handing municipalities the “benefits” of inflation. Now, faced, with deflation, and rising unemployment, no problem, presto, a proposed tax increase.

Prelude to panic, perhaps, but they can’t tax this away from us....


Saturday, May 9, 2009

Bus to Nowhere

May 5th’s Palm Beach Post proclaimed “West Palm Beach's new bus depot 4 days from debut,” an encouraging development for mass transit in this area, in keeping with national priorities as well. One of the main objectives is “a seamless connection to the regional commuter train system.” That system is Florida’s Tri-Rail, the only mass transit system for moving passengers in the heavily traveled North/South corridor between West Palm Beach and Miami, also connecting to Ft. Lauderdale and Miami airports.

So far, so good, an improvement to one of the connecting tributaries, something that will provide dependable and reasonably priced transportation to those who either can’t afford driving that route or simply encourage people to give up on their gas guzzlers for such trips. In fact, since the economic downturn began and fuel prices spiked, ridership has almost doubled.

Is this one of the green shoots we’ve heard about? Such an expansion of mass transit not only accomplishes these important local and national objectives, but also provides jobs as well, not to mention getting people to their jobs.

Ironically, in the same issue of the Post, is another story: “Tri-Rail's hopes for emergency state money are dashed; by fall weekend service ends, entire system could close in 18 months.”
“The Florida legislature Tuesday refused to include $30 million in emergency Tri-Rail funding in the 2009 budget, as requested Sunday by a group of legislators in an open letter to GOP leaders.”

$30 million? – mere chump change that hardly qualifies as a down payment on what has now been revealed as AIG’s real bonuses payments for 2008, $454M. This is the amount which Florida is refusing to fund, or does not care enough about to fight for some federal government sponsored money to keep one of its few mass transit options open? The legislature is obviously willing to play political hardball at the expense of people who are dependent on the system for their very employment. Didn’t they get the message from Washington about improving our infrastructure as being one of the pillars of the stimulus package? Clearly they are not aware of the new buses to nowhere.