Tuesday, December 02, 2008

Budget Trash

The budget for the Department of Sanitation proved to be one of the biggest sticking points at City Council yesterday. Veronica White was a no-show.

From the Times-Picayune:

The climactic debate involved the Sanitation Department, the object of frequent criticism from some council members, particularly over suggestions that the three companies that collect trash for the city have been serving far fewer addresses than they have billed the city for.

Sanitation Director Veronica White, who clashed angrily with Councilwoman Stacy Head during the council's hearing on the department's budget three weeks ago, was not present for the debate, and her name was barely mentioned.

After rejecting an amendment by council President Jackie Clarkson that would have cut 15 percent of the Sanitation Department's budget and diverted $4 million to pay for repairing street lights across the city, council members voted 4-3 to put half of the allocation in reserve and to require a second audit of the trash collection deals.

The results of an initial audit of the companies' performance is due next week, but some members made it clear that they want an audit by a firm with no ties to the administration.

Clarkson, Head, Fielkow and Shelley Midura voted for the move, with James Carter, Cynthia Hedge-Morrell and Cynthia Willard-Lewis opposed.

Hedge-Morrell, the chairwoman of the council's Budget Committee, had proposed putting 15 percent of the sanitation budget in reserve, but the majority wanted to go further.

Later, Nagin swooped in to blast Council's budget.

In an unexpected late-night appearance before the council, Nagin said he was "a little disappointed" at its actions and said the city is "headed for a financial train wreck" in 2010 because of the council.

Do you think he'll veto it?

Nagin believes the train wreck is upcoming because of Council's decision to use one-time monies to plug this year's budget gap. I generally don't support that kind of budgeting either, actually, but we're talking about $10 million. Are we really on such soft footing for 2010 that this reallocation of 10 million bucks tips us over? That's something the Mayor should answer for, not Council.


An anonymous reader reports that, in fact, Veronica White was in Council chambers. She was a no-show at the microphone, offering no defense of her department.

Blogs are awesome because of readers.

Does this mean that the T-P's mention that White "was not present for the debate" is inaccurate? Their line leaves a little bit more latitude than what I extrapolated.


Anonymous said...

Veronica White was at the meeting but was kept away from the mic. She allowed Metro and Richards to do her bidding while she chatted with Penya Smith and Brenda Hatfield.

Seung said...

Eli, the hole is a lot more than $10 million. The 2009 budget was already using $25 million in CDL dollars. We just added the rest of it. We are balancing the 2009 budget with $35 million now in CDL dollars with nothing left for 2010, despite a lot of economic uncertainty for the future. We also reduced our reserves by $14 million. Basically, what we did was borrow from the future to balance the budget of the present. We didn't balance the budget with recurring revenue that is going to be there next year to pay for recurring expenses. We balanced it $35 million of CDL money and by reducing our reserves by $14 million to a balance of $24 million, which is $6 million less than the city's cost for Gustav. That is $49 million of revenue that didn't come from local (recurring) tax or fee collections. That is the kind of hole that could potentially become a serious trainwreck in a general fund budget of $500 million without new revenue.

As a general rule, one time revenue should not be used to fund recurring expenses. It is usually sounder to invest it in infrastructure or capital projects.

At some point the bill has to be paid. And that reckoning might come in the 2010 budget. It is a serious concern for many of us.

E said...

I see. The TP article referred to the extra 10 as the sticking point.

Your analysis would seem to indicate that the Mayor's millage increase isn't such a bad idea.

I know Council was hoping for spending cuts instead of the tax increase.

What departments should have been cut that were not?

What about actually cutting the sanitation budget instead of putting it on hold? What proposed spending increases in the Mayor's office of communication? Did those make it in to the budget that Council passed?

Seung said...

Midura proposed 2.5% caps on all department budget increases from 2008 levels. A few exceptions were made, especially for public safety. Along with additional recommended line item cuts to several departments (vehicles, crime cameras, etc.), it led to a savings of nearly $30 million, which would have balanced the budget. Of course it was a proposal open to suggestions and tweaks, but we thought it was a fair starting point for discussion.

We did in fact propose a 15% cut to the sanitation budget. That vote failed 4-3.

Seung said...

I do however want to point out some of the unheralded victories that made little or no waves in the press. The Council appropriated $97k to the Juvenile Court to help fund alternatives to incarceration, $250k to the DA for alternatives, and $1.7M to the Public Defenders office, who have 90% of the same cases that the DA has with 1/4th the budget. I wanted to point those out in particular because those are groups who are usually especially underserved: low income people of color and at-risk kids. They don't have powerful campaign contributors, they have very little interest group influence, they are usually assumed guilty, and they are often easily treated as disposable or warehouseable. Too often they are simply discarded into jails or the street without any care given to how their lives might be saved or redeemed, despite that the cost of these policies being borne out not only by them, but by the rest of New Orleans in the way of crime, poverty, eroded family structures, and missed opportunities. $2M isn't enough, but in a tight budget, it was a start.

E said...

Those things are a start, Seung. I know that you've worked very hard on criminal justice issues here. I believe that is one of the biggest challenges we face - not crime - but the cyclical nature of Louisiana's prison industrial complex.