The City is proposing an increase in spending this year of 5.3%, a rate that's a fairly digestible number in the abstract, and representing $17.9 million in additional spending for the coming budget year over this year's figure.
Who's Paying the Bill?
Of course, the number that's garnering attention is the increase in property tax revenues: a sizable 16.5% increase over the FY08 figure. The biggest contributor to that is a 28.6% increase in Durham's assessed property values thanks to last year's revaluation, bringing the Bull City property tax base from $17 billion to about $22 billion. Yet the City's budget proposes only a 9.4% reduction in the property tax rate. (Which also means, an 11% rise from the revenue-neutral rate.)
The net result? A $17.6 million increase in Durham's estimated property tax collection. Though that's not the only net new increase in cost to most residents. An additional $12.3 million in operating revenue increase is projected, almost of all of which is attributed to the implementation of tiered water rates.
Of course, this impacts businesses as well as residents, but given the increase of pricing across-the-board for all residents with the increase of base sewer and water fees, this revenue source is one to be borne by practically every household. (And don't expect the rates to stay constant -- the city is projecting water/sewer revenue to rise from $58 million this year to $70 million next under the tiers... then all the way to $93 million by 2014.)
So we have almost $30 million in new property tax and water bill fees, yet just $17.9 million in new spending. Where's the gap? From $18.1 million in decreases in six different categories of revenue, including:
- A $2.3m reduction in collection of other local taxes, primarily due to the changed city/county sales tax split and the slowing economy;
- A $5 million reduction in drawdown of fund balances, primarily by eliminating this year's $4.7 million draw from the water/sewer fund (given that higher water/sewer rates can make up some needed revenue)
- A $7.8 million drop in license/permit, investment/rental income, and current services charges funding.
Bottom line: look for more of the cost of local government this year to come from households and businesses across the board, and less from various fees, charges, and licenses, due in some part to the changing national economy.
What Are We Buying?
In his budget transmission letter, outgoing City Manager Patrick Baker highlights a few key elements as across-the-board changes in the budget, including:
- Staffing for the new North Durham fire station, as well as authorizing "overhiring" of the current police officer count in order to be prepared to handle vacancies;
- Addition of a commercial code and residential code inspector to search for violations under the City's essentially voluntary program;
- $1 million in neighborhood revitalization, infrastructure and streetscape funding;
- A comprehensive yard waste program, including free pick-up of yard waste items as well as a pilot program for leaf vacuuming -- together, this represents one of the major drivers of increased operating costs, representing about one-sixth of the expense.
- A reorganization of City/County Planning, including 5 new staff members, to improve the efficiency of that department's operation;
- Funding for a feasibility assessment for the conversion of the Downtown Loop to two-way traffic;
- Increased youth services -- more on this to follow in discussing Parks & Rec below;
- No new major bus routes or increases in frequency, save for a downtown "circulator" route to help serve the Durham Station. (We're looking forward to more details on this, which could be an excellent new transportation service downtown.)
Still, one of the big things we're buying with a program like this is people -- that is, full-time staff, increased expesnes of which represent $10 million in new spending.
Where's that new hiring happening? Not where you might think.
The biggest increase would come in Community Services & Development, at a 9.4% increase in the number of new staff.
Public Works, for instance, would increase by 11 FTEs, or only 4.2%, not including the transfer of street-cleaning responsibilities from Solid Waste Management.
For its part, Solid Waste Management would increase by 9 FTEs (7.6%), all in residential collections, which would increase from 58 to 67 staff. What's odd there, though, is that the North Carolina Benchmarking Project has identified Durham as having above-average staffing yet below-average waste creation levels relative to other major N.C. cities already. Durham's refuse tons collected per municipal collection FTE is also the pits: 855 tons/FTE in Durham vs. an average of 1,467 tons/FTE among other municipalities.
Are these new refuse collectors intended to staff the yard waste program? Perhaps -- but the org chart for Solid Waste shows no change in the staff on Yard Waste Collections (17 FTEs), and all the growth in Residential Collections.
Perhaps the new staff are intended to address the level of complaints about garbage service, which are 30% higher than in other N.C. cities. (On the other hand, SWM adopted higher targets for number of complaints in FY2008 than they actually received in FY2007. Hey, that's one way to make sure you meet your goals -- set 'em weaker than the year before!)
For its part, Water Management is set for a 5.8% increase in staffing level, with almost all of the 17 new FTEs aimed in the Systems Maintenance & Construction and System Rehab groups, both of which are involved in adding to and replacing core trunk, line and pipeline infrastructure -- all of which we all know is challenged in Durham. Seems to make sense.
But the real gutbuster for Community Services & Development? You betcha: it's everyone favorite, Parks & Recreation, which would see a whopping 12.3% increase, with 18 new staff increasing its base of employees from 97 to 115.
And what will these new Parks & Rec folks be doing, other than apparently not keeping cars out of Duke Park? You guessed it -- rec centers! New staff for the Lyon Park center and the Holton Middle School center, plus to provide alternative programming for Walltown (with its center closed for renovations). And we haven't even built the new Walltown or bought the Trinity Ave. centers yet. Add in five more folks for aquatics, mature adults and special populations.
The best place to put things in comparison? The Public Protection category, which is adding just 21 FTEs to its 1,013 budgeted level. And 18 of those staff are new firefighters for Fire Station 15 in North Durham.
New police officers? Just two, or an increase of 0.3% in overall police staffing. Clearly, of course, a sign that our anti-crime strategy is working, right? Right?
Tongue out of cheek for a moment, one can assume that the authority to overstaff existing FTE positions in the D.P.D. -- which basically means hiring more people than you have allocated positions, in the idea that you'll always have some vacancies, and the two add up to get you to the allocated number of positions -- is really the equivalent of adding many more positions.
Still, this is an image-conscious place. And it just doesn't look good to propose adding 9 new Parks & Rec staff for every new D.P.D. officer. We'll see how the City can spin this; I can already imagine how the John Locke Foundation will skewer Durham leadership over that number.
Overall, staffing would grow by 3.8%, bringing the City to 2,455 full-time employees.
Folks, that's a mouthful of numbers, and we haven't even gotten to the capital projects. We'll cover that in the next couple of weeks as the data become clearer.
Want to see things for yourself? Visit the FY2009 budget proposal web site on Durham's home page. The 2007-08 budget is still posted, too, if you want to compare the year that is to the year that might be. Municipal benchmarking data is also available.