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Council members considering mid-year budget adjustment

Thursday, February 27, 2014 by Michael Kanin

With more than a quorum’s worth of Austin City Council members angling to use roughly $14 million in 2013 budget surplus for various projects in piecemeal fashion, the group Tuesday signaled its desire to have a more comprehensive discussion about the matter.


“If we’re going to talk about where our priorities lie, somehow, someway in that equation, there has to be money for floodplain buyout programs,” said Council Member Mike Martinez. “I would urge us to have a broader conversation about what our priorities are.”


Council members directed city staff to prepare an item that would allow them to discuss the timing of a comprehensive budget adjustment. That discussion will be set for next week.


Meanwhile, Mayor Lee Leffingwell appears set on the idea that the money should be used to hold tax rates steady. Should that happen, the city would still stand to collect more tax revenue thanks to perpetually increasing property values and a continuing boom in construction.


Leffingwell, who gave his final state of the city address Tuesday afternoon, was absent from the work session. City Manager Marc Ott has instructed departments to prepare budgets that meet the limitations of a steady tax rate.


News of the surplus was delivered to Council’s Audit and Finance Committee earlier this month by Chief Financial Officer Elaine Hart along with the news that management was not planning a mid-year budget adjustment. Ott has given similar indications.


Deputy Chief Financial Officer Ed Van Eenoo told Council members Tuesday that, with the focus so firmly on keeping the tax rate steady, the annual ritual of delivering departmental statements on unmet needs was also changing.


“In light of City Manager’s direction…we’ve actually sent out direction to our departments this year that we are not going to be taking unmet service demands in the normal sense,” Van Eenoo said. “We’re asking our departments to go about doing their work and identify what we’re calling critical priorities, but to the extent that there are critical priorities, we want our departments to first be looking at their existing services, their existing programs.”


Faced with similar budgetary circumstances last year, Council members used a mid-year budget adjustment to provide stop-gap affordable housing funding in the wake of a 2012 ballot failure.


Council’s discussion about what to do with this year’s surplus carried over from the Audit and Finance Committee meeting as Council members began this week to pepper the agenda with potential uses for the $14 million surplus. Council Member Kathie Tovo is responsible for an item that would use $700,000 to upgrade the kitchen of the newly completed Asian-American Resource Center to industrial strength. That move, argues Tovo and staff, would allow the facility to better host meal programs already funded for the center.


Council Member Chris Riley offered an item to fund the South Shore Central Small Area Plan. He argued that such an effort would control development along Lady Bird Lake.


And Martinez is pitching an item that would “expand the existing annual agreement” the city holds with the Austin Technology Council.


Martinez’ colleagues mostly agreed with the need for expanded discussion. Still, Council Member Bill Spelman wondered if it might not be better to wait until the budget office produces the new critical priorities lists. Staff told Spelman that those items would likely not be ready until late April.


Riley, Tovo, and Council Member Laura Morrison each worried that a delay might jeopardize one or more projects. Council discussion next week should include that issue.

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