As I'll explain within the next couple posts, things have been really busy with travel and other obligations—so much so that I've not yet posted on the fact that the Capital Improvement Program was passed by the Council, even though Council member Darren Lathen and I voted against it. Not that we didn't support the projects, we didn't feel enough was done to avoid a tax increase. To pay for it all will require an increase in the tax rate by 1.5¢ evaluation to 70.36¢/$100, the sixth highest in the Metroplex, ninth highest for residential homestead tax payers—or we'll have to find $19 million laying around.
 
A recent article in the Dallas Morning News explained the final vote quite well. Please continue to read below the article for additional comments.
 

Garland approves $196.4 million capital
improvement program, anticipating tax increase

Property taxes likely will increase by 1.5 cents to cover program
 
12:00 AM CST on Saturday, March 8, 2008
By FRANK TREJO / The Dallas Morning News
ftrejo@dallasnews.com
 
The economic downturn forced Garland City Council members to perform a delicate balancing act this week as they approved a $196.4 million capital improvement program that anticipates a 1.5-cent property tax increase.
 
On one side, the council considered the effect of more taxes on already financially burdened residents. On the other, it saw the need to continue major infrastructure and development projects that it hopes will expand the city's tax base.
 
In the end, the council approved the program Tuesday 7-2.
 
"We really wrestled with this, but in the end we felt we had to go forward to be consistent with what citizens have told us they wanted," said Mayor Ronald Jones, who noted that much of the money is for projects approved in 1997 and 2004 bond packages. "Putting those projects on the ground that citizens voted for and said they wanted was very important to me."
 
Mr. Jones stressed that approval of the package did not automatically mean a tax increase.
 
"We didn't vote on a tax increase. We agreed to go forward with this program knowing that it could very well mean a tax increase," he said. "That will be decided in August when we work on the general budget."
 
But council member Douglas Athas, who with Darren Lathen opposed the program, said there now is no way to avoid a tax increase.
 
"My biggest concern is that right now, in 2008, property values are declining and people are in the worst position right now to be absorbing more taxes," Mr. Athas said.
 
He said the program also would mean increases in fees for water and other utilities.
 
A tax rate increase of 1.5 cents per $100 of property value would take Garland's rate to 70.36 cents per $100 of value, keeping it among the region's highest.
 
Mr. Athas said he opposed the program because he did not think the council had tried as hard as it could to prioritize projects and cut those that were not immediately essential.
 
The city is at a critical point in its development, he said.
 
"In the city manager's budget there are programs and plans for ways in which to literally change the way we do business in Garland, to make it much leaner and much more competitive than it's ever been," Mr. Athas said.
 
But until those changes are in place, he said, it's difficult to determine how much debt the city can absorb.
 
The capital improvement program, a combination of a one-year budget and a five-year plan, is designed to set priorities and determine how to pay for items such as streets, buildings and equipment. It is different from the operating budget, which the city approves before the Oct. 1 start of each fiscal year.
 
This year's capital improvement program is nearly $63 million less than the $259.2 million program that the council approved last year. City staff members told the council that the reduction was prompted by concerns about continuing declines in home values. About 60 percent of the city's property tax base is residential.
 
Council member Laura Perkins Cox called this year's capital improvement program "meat and potatoes and no gravy." She said cutting and prioritizing had been done before the program was submitted to the council for approval.
 
"I applaud the staff for working with council and listening to our concerns," Ms. Cox said. "Preference is being given to those projects that will give you more bang for the buck ... and that's what we're always looking for."
 
Ms. Cox noted that the council usually considers the capital improvement program in December and January. But this year, the city staff delayed presenting it to the council so decisions could be made about which projects needed to be funded and which could be delayed.
 
She said Garland has learned from the budget decisions of cities such as Dallas "that deferred maintenance on things such as streets and library improvements, and they now have to pay for new projects with costs that are astronomical."
 

 
I'm sure it's a character flaw, but it is extremely difficult for me to allow some statements to go unchallenged that I feel don't accurately convey the picture I see. I don't claim my view is any more valid than someone else's but to say nothing allows only one point to be put forward for consideration.
 
Suggestions that anyone would intentionally allow our infrastructure to fall into disrepair are simply too narrow. It is a basic fact that not maintaining infrastructure can be much more harmful than the irritations of wheels out of line or utilities that don't work correctly. Poor infrastructure sends a clear and negative picture to anyone wishing to buy a home or business in the city. But that doesn't stop the Council from closely reviewing the proposed budget and trimming any items that do not need to built right now.
 
Suggestions that we were on the precipice of repeating the mistakes of other cities that have allowed infrastructure to fall to disrepair just isn't a correct reflection. These supposed other cities that are having to spend tremendous amounts to catch up to their miserliness would now be doing so with a lower tax rate than Garland because we are near the top. I would love to be playing catch up with a lower tax rate—it would be the best of all worlds.
 
The proposed budget comes directly from the staff. I'm sure they do their best to anticipate the individual agendas of nine Council members and the city's needs but, unless they are mind readers, they can't be exact. To not tweak the budget to fit the needs of the day is both a lost opportunity to fulfill our role as policy setters and to trim the edges for any excess, which by process has to exist. A major portion of my argument was that the Council was not setting its goals, just blindly accepting the staffs' goals. Sidewalks at one point were a major topic (out of $194 million in projects). The Council could have set forth a policy that sidewalks near schools that would save children from having to walk in the streets or through the mud would was a great priority. It was mentioned but never formally accepted. New emphasis could have been placed on bike trails that have long been in the Park Dept's plans but never funded. These would have supported better pedestrian flow and been much less expensive than a lot of the programs that were never examined.
 
It is true that the voters did approve these bond projects in previous elections. I was one of those voters. (If they hadn't been approved, we wouldn't be discussing them.) I can't fathom that the voters in 1997 and 2004 were saying, "We want you to do these things no matter what the economy does and no matter how much it costs us." For me and I assume for most others, it was expected that the Council would be deliberatory and diligent before moving forward.
 
We all know that we are in an economic slowdown of unknown duration. (It's not a recession by definition because we've not had two consecutive quarters of negative growth.) If the city is facing declining property values (and we are), then we are also facing declining tax revenues. Current projections, which are hopefully conservative, show we can manage to finance this CIP. But what if things get worse that we currently forecast? We could easily find ourselves in the very undesirable position of being forced to raise taxes to just cover our current debt. Why would we be adding debt that forces us to raise taxes at a painful time for tax payers? I trust this scenario is darker than we'll actually face … but what if it isn't?
 
Finally, City Manager Bill Dollar presented his 2008 Management Agenda to the Council in January and it was unanimously adopted. It is brilliant and will make 2008 a turnaround year for Garland. I've prepared a post covering it but I've not finished editing it. That agenda represents the greatest and best changes the city has ever experienced. I cannot imagine how anyone would not be excited knowing and understanding where we are headed. Much of it addresses my agenda since running for office in June, 2006. I couldn't be more hopeful and excited about Garland's future.
 
However, 2008 is the approach to the first tee. We're dressed in our knickers but the game has not started. We're still taking our warm-up strokes. There are great things coming but we're not there. That was the other side of my argument on the CIP: we should do what we could to hold a tax increase and to use 2008 to pay down some of that debt we are carrying that is so much higher than the other major cities in the area. Then we could go out there and try for a hole-in-one!

2 comments

Comments:

Comment from: Steven Sanders [Visitor]

Is the 2008 Management Agenda presented by the City Manager available to the public? I searched the City web site and noticed it was covered in executive session in January however if it is as wonderful as you say should we all not be able to see it? Thank you.

03/12/08 @ 00:50

Comment from: Sara M García [Visitor]

As a citizen of Garland, an increase of a few cents per hundred dollars is not that much money to spruce our town up a bit. Several of my family members live and work or have a business in Garland. We frequently discuss the crumbling curbs outside of our homes, the pot holes on our roads, the water run-off all the new construction in Garland has caused and the decrepit-looking retail areas in our city. This "homeliness" has been a problem for years; longer than this new economic downturn. If we didn't work on our infrastructure when the times we supposedly good, then when will we ever? We are all enduring similar economic hardships but not all of us are unwilling to do our part to make sure necessary repairs get done. The City has a long way to go in order to please many of its long-time residents, especially those of us who may be deciding whether we can get more for our dollar by living elsewhere.

03/12/08 @ 17:04

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