LETTER: Mayor responds to mosquito, budget comments

From Mayor Steve Cook
Hutchinson

As much as I respect LaVonne Hansen’s passion, her letters on the proposed mosquito levy and city budgeting warrant a response. Failure to do so does a disservice to the public, the Hutchinson City Council and city staff. The letter on the mosquito levy is particularly important to address because much of what was included was inaccurate or simply false.

Mosquito control cherry-picked:
It is simply not true that mosquito control was removed from the budget even before the city directors started their balancing process. When the council provided budget parameters to city staff in January for the 2009 budget, no direction was given to staff on what, if any, programs or services should be cut if necessary. There were no sacred cows, either.

Not a $45,000 issue:
This is not just about finding $45,000. In an effort to minimize the tax impact on property owners and continue our efforts to lower Hutchinson’s tax rate, the council’s original budget parameters resulted in a projected $660,000 budget shortfall for 2009. This was even before the state imposed levy limits on local governments.

Budget decisions were based on what are essential and critical services and what are not. Revenues were looked at and increases were added where reasonable, including from enterprise funds (they actually subsidize the general fund — not the other way around). Expenditures were scrutinized and are currently increasing just 2 percent. However, we are still working through a larger than expected increase in health care costs.

When the council decided to use $200,000 in new LGA to help balance the budget that still left a $460,000 shortfall, even without the additional health care cost and higher than expected fuel and utility costs. Besides mosquito control, reductions on the table include, among other things, our drug task force position, outdoor ice skating, city help with the community gardens, and impacts on positions in various departments including parks, streets, motor pool, legal services, information technology and motor vehicles.

2008 surplus:
No large surplus is anticipated for 2008. In fact, temporary spending controls have recently been put in place to ensure the budget is met because costs are higher than expected in some areas and revenues are lower in others. This is also necessary because of the tighter budgeting that has been taking place.

That said, the city should, and almost always does, have a surplus at the end of the each year. Besides being good business practice, the city needs a fund balance to help with cash flow through the year since a large portion of revenues, especially from the state, are received later in the year. The state auditor recommends a fund balance of between 35 percent and 50 percent, with the city currently at about 43 percent. As the city’s budget increases, the fund balance should increase accordingly. If more becomes available it can be used in the budget, but that needs to be done cautiously since an excess surplus is basically one-time money.

What about fewer projects:
Not doing improvement projects does not make more money available for programs and services. That is because projects are typically paid for by bonds and those dollars can only be used for project costs, not day-to-day programs and services. With levy limits in place, the potential to shift “freed up” tax dollars from projects to programs and services by not doing projects is also taken away.

Public vote:
It’s fair to say this was not the first option for some council members. However, with public input indicating support for the mosquito program, the vote option offers an opportunity to preserve the program, gives the council a little more flexibility with other important services, and follows the rules imposed by the state.

In the end it is about opinions. The council made its decision on what it thought best after weighing the various issues, information and options. Some may not agree with the decision, but others are happy to have the opportunity.

Budget process comments:
As far as Ms. Hansen’s comments on the budget process, there is more agreement. The good news is that many things are being done or are being worked on. While it might not be as fast as we might like at times, we are moving in the right direction.

Since we start the budget process early in the year, adjustments are made during the process as prior year numbers and other factors become clearer. Priorities, goals and objectives are being clarified. Performance indicators and trending are being incorporated. Enterprise funds are being driven to run efficiently and effectively. Grant opportunities and partnerships are explored whenever possible with the state and federal governments; as well as with other cities, the county, school district, and other organizations. Benchmarking and best practices have been utilized and continue to be looked at. World class practices like Baldrige and ISO are being investigated. Comparisons are being done with other cities. The city is doing multi-year budgeting in both its general fund and capital improvement plans. A solid bonding plan is in place.

Can more be done? I’m sure there is, but the city is doing a lot of good things. This is really about continuous improvement. That is a priority in all areas of the city and it starts at the top.