The current City Council majority likes to tout its skill in balancing the budget, but a review of recent budgets
tells a different story.
Did you know that the Fiscal Year 2014-2015 Budget appropriates $139.9
million on anticipated revenues of just $132.8 million? And that’s not all. Every budget adopted over
the past four years has been similarly out of balance.
That’s right. In four
years of rising revenues, the Righeimer Council has yet to adopt a budget that balances spending and
revenues.
Every budget adopted for the past four years has relied on
savings in order to balance. In four
years, Jim Righeimer has never voted for a truly balanced budget, with planned
spending at or below anticipated revenue.
As revenues have risen, the urge to spend has followed. Appropriations increased 28 percent from
Fiscal Year 2010-2011 to FY 2014-2015.
It isn’t unusual for a City to go into savings for a major construction project, as would have occurred under our adopted budgets, but the money has to be saved up in the first place. Costa Mesa could have been in real financial trouble if we’d
hit another financial bump in the road.
Fortunately for Costa Mesa’s financial future, tax revenues are
at record levels. In addition, it wasn’t possible for city staff
to get the money out the door as fast as some on the City Council may have liked.
So what about those much-vaunted capital improvements?
Capital improvement spending has remained relatively modest, when compared to pre-recessionary years. In the past, the City rehabilitated as many as fifty miles of arterial streets in a single year as well as repaving numerous residential streets (2007-2008). In recent years it's been less than half that.
Spending is below the amounts appropriated, not yet
rebounding to pre-recessionary levels. A
good thing, too. If all appropriated
funds had been spent, we’d really be in the hole.
At the same time, it is important that we maintain our infrastructure and not allow it to degrade. But as we pursue major projects we must make sure we have appropriate priorities.
City beautification is nice, but with all our other pressing needs, should that be a priority? The new landscaping on Harbor Boulevard is lovely, but is it really the best use of our tax dollars, as well as our residents' time stuck in construction traffic, as we pay contractors to rip out pink stamped concrete and replace it with rocks that look like ... er... gray stamped concrete?
Not to mention the Manolo Blahniks of the crosswalks world. Just like Manolo stilettos, they look great, but cost a bundle and are impractical for their ostensible purpose, i.e. walking.
Let's spend our infrastructure dollars wisely.
Right now, Costa Mesa still needs to
consider all spending very carefully—and not call a budget “balanced” when it’s
balanced by our hard earned savings.
6 comments:
But what else should we expect from a mayor who is so arithmetically challenged that he names three separate figures for the pension deficit over the course of two meetings? A mayor who has to remove his shoes to count to eleven, and who agonizes over whether two plus two equals five or not? A mayor who does not lie, prevaricate, dissimulate, disingenuate, fib, tell whoppers, or stretch the truth, but only MISSPEAKS?
Delenda est Karthago.
I would pose a few questions to supplant the analysis:
1) Can you provide last ten years data on non-city monies (grants and distributions) that have been used for capital improvements and the total of city and non-city monies expended each year? It seems to me that one of the advantages Costa Mesa has had recently is having "seed money" to match with grants for infrastructure which has given us a competitive advantage over other cities with less money, and that total spending on infrastructure is a more germane measure of success
2) Do you see a positive correlation between civic beautification and property values/tax receipts? If so, is it not correlated enough to justify these projects, or is there another reason you are opposed to them?
3) If in the years when the city was performing in deficit capital spending was higher, is that not a bad thing. Why should the city ever do so and why does that behavior compare favorably to more modest capital spending while there is an actual (not planned) surplus?
Thank you for taking the time to post.
The last year for which we have audited numbers shows about twenty percent of capital expenditures being local funds. This includes both general revenues set aside for that purpose and impact fees paid by new development. We get some outside funds such as the gas tax, a portion of Measure M funds and CDBG on a per capita or other routine basis and we have used these as our "match" for some grants. If you are interested, I encourage you to go through annual the budgets http://costamesaca.gov/index.aspx?page=170 and audits http://costamesaca.gov/index.aspx?page=167 and share your research.
Beautification is nice, but when we have falling apart fire stations, that should be the priority. Each year we consider artifical turf for Jack Hammett, which would allow it to accommodate more kids, but spend elsewhere. Have you ever tried walking on one of those fancy crosswalks when it's wet? The one at Mesa Verde and Baker gets pretty slick. Are we increasing risk for pedestrians and city liability?
Not sure what you mean by the third question. I am a conservative spender, so have bought all my vehicles by saving up and paying cash. In the years I am saving up, I have a "surplus". In the year I buy the car, I have a net deficit in that I would likely have spent more than I took in for that year, but in a responsible way. It is only possible because I saved in the first place.
To go into the year assuming we will "get lucky" leaves us in a bad way if there is an economic downturn or natural disaster. Look at the daily newspaper. It's not all sunshine and roses.
Plus, the surpluses were NOT SAVED TO RESERVES. The council voted to SPEND last year's surplus.
Mr. Smith:
Re: #2
I can believe that the fortification of the public golf course entry, and the re-do of the Mesa Verde medians absolutely enhance the property values of those specific neighborhoods.
However, probably not a boon to tax receipts, unless those homeowners decide to sell their homes.
A better balance would seem to improve areas that attract tourism (TOT income) and to improve reserves and replenish the self insurance coffers. These would improve the credit rating of the city, allowing for better rates.
Andrew,
Sandy's right -- your last question is somewhat punctuationally-challenged. Correct me if I'm wrong, but I believe a comma should follow the word "deficit" to set off the adverbial subjunctive clause that precedes it. This then highlights the ambiguity of what you mean by "performing in deficit". It could mean "using reserves"; or it could be interpreted in other ways. Some elucidation here would be appreciated.
We then get "If...capital spending was higher", a comparative without a comparison. Higher than what? Than perhaps what revenue took in? or higher than previous years? Again, elucidation would be vastly appreciated, and indeed necessary.
Next, do you intend the clause "is that not a bad thing." as a question? If so, it should be followed by a question mark. If intended as a rhetorical device, may I suggest editing it to clarify the intent?
Then we have an ambiguous question somewhat lacking in an antecedent: "Why should the city ever do so..." Do what? Perform? Do a bad thing? Be higher?
Similarly, "that behavior" lacks a competent antecedent.
It therefore is unsurprising that Sandy states "Not sure what you mean by the third question."
Thank you in advance for taking the time to clarify this matter.
Does anyone really care what Andrew has to say or what he thinks?
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