by Bradley Parsons
Staff Writer
City Council member Lad Daniels’ ideas for a budget-neutral City government are gaining traction around City Hall.
Daniels is pushing a pair of bills that would change the way the City approaches its budget. The mayor’s office already announced its support for one, a bill that would require spending beyond the City’s annual budget to be backed by documented funding sources. The second bill, which would peg growth in the City’s budget to growth in inflation and population, has been received less enthusiastically.
Daniels was preparing a memo on the bills’ highlights as he discussed the legislation Wednesday. That memo will soon make the rounds on City Hall’s fourth floor ahead of the Council’s consideration of the bills. Daniels said the bills would help the City adhere to budget priorities, while still providing some flexibility.
“If we want to signal to the public that we’re committed to budget discipline, this is a great way to do it,” he said.
The spending bill essentially prohibits the City from buying on credit. The City couldn’t spend beyond budget limits without first finding a funding source.
Some of Daniels’ Council colleagues are concerned the legislation is too restrictive. They fear that the City wouldn’t be able to fund emergency needs in a timely manner.
But, Daniels said true emergencies are rare. He thinks many of the funding bills moved as emergencies could have — and should — have been accounted for during the budget process. During last week’s Budget Committee meeting, Daniels said bills are sometimes moved as emergencies to “get around” the usual approval process.
“I haven’t seen many emergencies since I’ve been on the Council,” said Daniels. “But I’ve seen us fund a lot of emergencies.”
Daniels’ bill still allows for emergency cash outlays, but they would require approval from 15 out of 19 Council members to pass.
The bill would also require the City to pay for recurring expenses with recurring revenues. Dipping into cash reserves would become much more difficult and the City would be barred from paying operational expenses with borrowed money.
The mayor’s office has endorsed that approach. But Daniels expects some debate before he wins approval for his second bill. That bill requires the City to replenish its reserve accounts that the past two budget cycles have drained. The bill would also limit the City’s budget so it couldn’t grow faster than the pace of inflation and the local population.
Daniels said he recognizes that the mayor’s office, “doesn’t want their hands tied,” by legislation. But he said the budget constraints would emphasize the City’s commitment to fiscal discipline.
The mayor’s office has also balked at the requirements to fund the City’s reserve accounts, but Daniels thinks the resistance was founded more on the numbers discussed than the concept.
Daniels said he’s flexible on how much the City would be required to contribute to reserves. But he wants to see a commitment to rebuilding the City’s emergency and contingency reserve funds.
“The first check that we write each year should be to our reserve accounts, but I’m not hung up on amounts,” he said. “It’s the process I that I want to get started.”
Daniels noted that it took 15 years to build up prior reserves of more than $60 million. Most of that money was spent by the last two budgets.