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Strayhorn, opponents argue about city budget

Tuesday, January 27, 2009 by Austin Monitor

Austin Mayoral candidate Carole Keeton Strayhorn took aim at the city’s budget on Monday, accusing the past several Councils of increasing city spending in excess of the growth in average family income. Strayhorn vowed to appoint a task force if she wins the Mayor’s office to seek out budget cuts to recommend to the Council this year.

 

“I believe that we must take strong action to curb the huge budget increases approved by Austin city government over the last six years. We simply cannot allow the growth of government to outpace the incomes of hard-working Austin families,” she said. “There is a gap between our city budget and the people, and I will close that gap.”

 

As she has in the past, Strayhorn continued to use figures related to the total city budget, including the money-making ventures at Austin Energy and the Austin Water Utility. In doing so, she pointed to the city’s total budget, which has grown from $1.84 billion in the 2002-03 fiscal year to $2.77 billion for the current 2008-09 fiscal year. “That’s more than a 50 percent increase, while the income for Austin families has increased only 3.29 percent during that same time frame,” she said citing annual income figures on the area’s median family income from the office of the Austin City Demographer.

 

The operating budget for Austin Energy at $1.3 billion, is the biggest single item in the city’s total budget, and has grown along with the utility’s customer base and generation capacity. “She used electricity sales in her total,” said Mayor Pro Tem Brewster McCracken. “Our electricity sales have grown because our economy is growing. It is a highly novel approach to call electricity sales a tax. No credible budget person says that when Samsung opened its new factory and bought a lot of electricity, that that was a tax. They needed the electricity to create computer chips and create jobs.”

 

The General Fund started at around $620 million but will go down as the city cuts its budget to meet lowered revenue forecasts.

 

To curb spending, Strayhorn said, “We need a mayor who will go through the budget line by line, ask the hard questions, and take decisive action. Upon my election, I will immediately appoint a high-powered mayor’s task force of budget experts to review current and projected spending for the city of Austin and will make recommendations to the city council to cut spending. There will be no outside consultants and it won’t cost the city a dime.”

 

When pressed for possible areas to cut Strayhorn cited two expenses she felt were unnecessary: new carpet for parts of the Austin Convention Center and the city’s lobbying programs in the state capitol and Washington D.C.

 

“One thing we won’t be doing is spending more than $800,000 for lobbyists to go to our state capitol…telling them what we need in the city of Austin. The Mayor and the Council are elected to represent the people. I’ll be going to that capitol. I’ll take Council members with me,” she said.

 

Strayhorn left the door open to layoffs this fall if she is elected Mayor, but pointed to the current Council and City Manager as the reasons she could not rule out job cuts. “You know that they have over-shot the runway when they are already talking freezes, freezes on salaries, and they’re promising layoffs to come,” she said. “Somehow, in my mind, I think those layoffs may not come until after May 9th or whatever the June runoff date is. But I can assure you that everyone knew tough times were coming back in September.”

 

City Manager Marc Ott, so far, has not proposed layoffs. He has requested department heads each to come up with a list of cost-cutting options as the city’s sales tax revenues fail to meet the conservative estimates included in the 2008-09 budget.

 

Strayhorn held her campaign news conference in the home of Bradley and Jennifer Bengston, who said paying property taxes made it more difficult to provide for their two daughters, one of whom has Downs Syndrome. “The more of our money we can keep, the more benefit we can give to her,” said Jennifer Bengston. “When we bought this house, it was like two and one-half times less than it’s valued at now.”

 

Her husband, Bradley, agreed that property taxes were a burden. “When I was cleaning up my kitchen, I noticed from 1996 until now that our property taxes have tripled. We have a couple of rental properties, too,” he said. “Over twelve years, they’ve tripled. I’m not quite sure what we’ve gotten for it.”

 

State law limits the amount property taxes can be increased on a property that qualifies as a family’s homestead. Records from the Travis Central Appraisal District show that on the Bengston’s home, the value is currently $411,000, up from $204,452 in 2000, and the property does have a homestead exemption. The Bengston’s do own five other properties in Travis County which would not have been protected by the state’s homestead laws.

 

Strayhorn’s characterization of the city’s budget and her proposals for cutting spending met with criticism from current members of the Council, both from the two running for Mayor and current Mayor Will Wynn. All three pointed out that by using the city’s total overall budget, instead of the General Fund budget, Strayhorn was including growth in enterprise departments that does not come at the expense of the taxpayer.

 

Council Member Lee Leffingwell took issue with the assumption that the city’s property tax rate was behind the rising tax bills cited by the Bengston’s. “On a person’s tax bill…keep in mind that only about 17 percent is city property tax,” he said. “About 60 percent is taxes to the school district. Property taxes have gone up mostly because valuations have gone up.” Leffingwell said he would consider a budget task force, “but I think we have to keep in mind that budget decisions are made by the City Council.”

 

As for Strayhorn’s pledge to handle the city’s lobbying duties on her own, current Mayor Will Wynn cautioned against taking on that duty. Having a professional lobbying team, Mayor Wynn said, has paid dividends for the city. “Oftentimes we hear people say ‘I wish you’d run the city more like a business’. If you look at what business does when it comes to lobby budgets, there’s a reason why some of the most successful businesses in Austin and Texas and America spend lots of money lobbying both at the state house and the federal level,” he said. “This is an example of Austin doing what big business does.”

 

While most of the lobbyists for the City are outside contractors, the city does have an office devoted to dealing with both the state and federal governments. Government Relations Officer John Hrncir told In Fact Daily that keeping track of developments at the state level is a full-time job, especially during the legislative session. “It’s important at the state level because city authority is constantly being undermined by various pieces of legislation,” Hrncir said. “There are typically 1500-2000 bills filed that impact cities and a lot of those impacts are negative. We also seek to pass legislation as well, but the main reason that we need the lobby team is defense against very harmful legislation.”

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