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November 20, 2014 Published in Editorials

Practical Or Profligate

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On Tuesday, Nov.11, City Council held a major debate on guidance and process for adoption this spring of the FY 2016 City Operating Budget and the FY 2016-25 Capital Improvement Program. Unlike most Council discussions, this one produced heated debate among the members.

The first issue that caused dissension concerned the way that members may propose additions and deletions to the budget. In the past, members proposed their additions and deletions and the staff analyzed each one. This consumed a great deal of staff time and most of the proposed changes never took place.

The new process involves the need for members to convince at least two additional members to support their request. Supporters of this change focused on the desirability of the Council talking among itself about the adds and deletes before they had to be adopted. Vice Mayor Allison Silberberg took great exception to this change and argued strenuously against it. The other six members were not impressed by her arguments and it passed 6-1.

We agree     with the Council majority that this change in the process should be made. The City staff is overwhelmed by the analysis of proposed adds and deletes and there is little doubt that much of it is wasted effort despite the rhetoric to the contrary. Council is a collective body and an individual member can do nothing on her or his own. Imposing the need to communicate and discuss earlier in the process recognizes that fact and could yield better analysis of proposed changes because staff can focus on what might actually happen rather than seven wish lists.

The second major debate occurred when Council took up the guidance to the City Manager for next year’s budget. Last year Council restricted the City Manager to proposing a budget with no real estate tax increase. This year Councilwoman Pepper proposed allowing the Manager to propose a tax increase because she was concerned with paying City staff sufficiently to keep them in the City. In a word she felt that it was more practical to allow the Manager to propose a tax increase if necessary.

Council Members Lovain, Smedberg and Wilson argued vehemently against the change saying that permitting it was tantamount to inviting a tax increase. They believe that Council could always increase the budget and taxes as they did last year if there is a good case presented. Inviting a proposed tax increase seems profligate to them. The Mayor, Vice Mayor and Members Chapman and Pepper disagreed and the guidance allowing a tax increase for the good of the city passed 4-3.

For the past year we have written repeatedly of the City’s precarious financial situation. The Manager’s 10 year budget analysis showed expenses outrunning revenue in an accelerating manner even under the most optimistic development scenarios. In the consideration of the budget for this year we were extremely disappointed that the Manager’s money saving plan to restrict the “Elderly Millionaire’s Real Estate Tax Break” was hardly considered by Council and that in the easiest budgetary year of the next 10 Council went ahead and raised the tax. We commented then that taxpayers might not be well served in coming years.

The decision by the four members to allow the Manager to raise the tax in his proposed budget can be read as a continuation of that trend. We feel, however, that the unintended consequences of this action are much more destructive. This decision underscores the refusal of this Council to understand that the fiscal situation does not allow for a continuation of business as usual.

The overwhelming majority of Council members are unwilling to face the restructuring of City services that is required. Perhaps they want to postpone it another year until after the fall elections in 2015. Perhaps they view annual increases in the real estate tax as unavoidable and wish to place the onus for making them upon the City Manager.

The facts are clear and unless there is some strategic direction in dealing with the shortage of revenue Alexandria’s taxpayers can look forward to a significant upward march in the real property tax rate. Telling department heads to trim their budgets by 10% a year is not a strategic direction and will lead to inadequate services. There must be a choice among services and Alexandrians are very poor at making these kinds of choices. We want it all and that is going to prove a very expensive approach.

That was the tragedy last year when Council rejected the Manger’s reform of the real estate tax subsidy plan for seniors. That was a new direction. There were new ways to take care of that problem that did not involve City action. The City could have saved its money and redirected it to areas that were more important. Council did not see it and wanted to “do it all”. Half of the one-cent increase could have been saved by that action.

Difficult times require skillful leadership. Unfortunately leadership in Alexandria is frequently replaced by pleasership. Elected officials want to please everyone. Pleasership is not leadership.

We now see this budget season as far more contentious and far less productive than it should be. In any case, until our elected leadership comes to terms with fiscal life in the 21st century, Alexandria will continue to have substantial budgetary debates and taxpayers can look forward to increasing tax rates.

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