The Corinth Budget Workshop That Wasn't

“I have always believed that everyone engaged in a particular enterprise is charged with a degree of responsibility for nurturing the enterprise, as opposed to exploiting it.”

--Jack Bobo, National Underwriter Life & Health

I am critical of the city’s budgeting of our tax dollars. In fact, if there’s one issue you and I agree upon most, it’s that the City of Corinth needs to control city spending and rethink its entire fiscal policy. Because of our mutual concern for Corinth’s finances, I want to share with you my recent experience at Corinth’s July 29th budget workshop.

The workshop started at about 7:45 and ended at 10:20. In all, twenty-nine people were present:

- 21 City employees
- 5 council members (Mayfield was absent.)
- 2 citizens (myself included)
- and 1 reporter from the Denton Record Chronicle

All twenty-nine of us sat crowded inside a small room adjacent to the council chamber to listen to the city Mgr. Berzina presenting the budget. It was the city’s chance to lay out a sensible fiscal plan and silence their loudest critic.

There's just one problem. At no point during the City of Corinth’s Annual Budget Workshop did the city present a budget. No line item, no budget, no debit service, no serious discussion about fiscal policy just 13 power point slides.

Here’s what they did talk about:

• cut SPAN transit services for disabled veterans, chronically ill and the elderly
• cost-of-living salary increases for city employees
• ways the city can raise taxes
• a separate demand by the city manager to give city employees yet another salary increase

Our fears are confirmed. The city exploits the enterprise instead of nurturing it. Instead of strong leadership and good ideas, we get opportunists and meaningless PowerPoint presentations.

Let’s take a deeper look at the ideas presented during the workshop:

Bad Idea #1:
Cut SPAN transit services for veterans and the elderly

Special Programs for Aging Needs (SPAN) is a private, non-profit organization whose mission is to provide “outstanding services to older persons, persons with disabilities, veterans, and the general public, including nutrition, social services, transportation, and other services to enable people to live as fully and independently as possible.”

As of the 2006 census, 3.3% of Corinth’s population was 65 years of age or older, or roughly 650 elderly residents. That doesn't include people with special needs or our disabled veterans who may benefit from SPAN’s services.

Based on the usage data, presented at the meeting, for SPAN's services it is a widely used program by our community. The way I see it, until you've pared down every excess in your spending, don't cut support services for our community's elderly and disabled.

(Visit SPAN’s website to learn how your donation or volunteer hours can make a difference: http://www.span-transit.org/v2/about.html)

Bad Idea #2:
Raise Taxes (but by how much?)

Finance Director Lee Ann presented to the City Council and the rest of us in attendance nine power point slides, none of which contained any budgetary information. It did, however, contain six options to raise taxes.

From what I could tell, the purpose of exploring ways to raise taxes was to cover a budget shortfall and give all city employees a pay raise. The question is how much do you raise taxes?

This is a tough one. On the one hand you have your revenue, and on the other hand you have your expenses. Your expense needs to be bellow your income to be balanced. You can raise taxes to a level that generates revenue in excess of your expenses, cut expenses to a level that generates excess revenue, or both.

The correct option is both. Cut unnecessary expenses, re-evaluate your budget, and then develop a reasonable tax plan based on that budget. If the city Mgr. doesn't know how to do that bring someone that can..You don’t propose raising taxes simply because you’re faced with a shortfall or want a pay raise. That avoids fixing the underlying issue.

A budget shortfall can occur for a lot of reasons, but the most common reasons are failure to cut expenses on the budget, increasing debit and failure to stick to the budget. As I’ve said many times at council meetings, creating a budget is easy, but it takes strong leadership and oversight to stick to it.

Bad Ideas #3 & 4:
Cost-of-living salary increases and demands by
the City Manager for additional city employee pay raises

Pay raises and cost-of-living salary adjustments are not bad ideas in and of themselves, but they are bad ideas when put in the same context as raising taxes and terminating transit services for the elderly and disabled.

Compounding the issue is that the demands for pay raises came from City Manager Jim Berzina who costs us over $ 200,000 a year and whose pay has become a sensitive subject. At the end of the day, however, you don't need poor context or an overpaid city manager to tell you that giving raises to an overstaffed city hall is a bad idea.

Just look at the data.

Information gathered from Texas Workforce Commission and IRS forms filed by the City of Corinth show that the average pay per city employee increased from $47,392 in the 1st quarter of 2009 to $ 49,092 in 1st quarter of 2010.

That average doesn't include the $7,400 health coverage package per employee (regardless of position or salary), and it does not include retirement benefits or fully paid vacation and sick days. The city employee receives $ 59,750 average pay. The average income for an individual Corinth resident is $ 36,500.

In the wake of higher pay for city employees, Denton County struggles with the highest unemployment rates in recent history, not to mention the lingering effects of the mortgage crisis. Property values declined, business scaled back because that's what happens in a down economy. Private companies downsize its workforce by at least 25%, cut pay, furlough, reducing work hours and benefits.

The City of Corinth, however, wants pay raises. It wants to tax and spend and further burden its citizens with debt. It's like Vanya Cohen said, "When there's a single thief, it's robbery. When there are a thousand thieves, it's taxation." Whatever angle you want to take that one from, be my guest, but make no mistake that until a budget is made available to the public, it's robbery.

Still waiting for that budget...

But we don't have to wait for good ideas. Already I talked about cleaning house and approving a budget instead of cutting services to the elderly and the disabled, before taxing an already economically battered community, and before giving all of city hall a pay raise. Did I miss anything?

I'll take it a step further and offer the following plan:

As of today we have 158 employees, 35 with the police department and 41 with the Fire department. We need to seperate our first respondants then I propose that the remaining 82 employees receive an immediate 15% cut in pay. It's not personal. It's business. Just a thought.

What are your ideas?