Straight Talk III Delivered

I wonder if the City Fathers are so remote from the problems of the common taxpayer that they don’t see that their Straight Talk III may seem irrelevant to others. When will the day come that they appear to place less significance to the protection of the bureaucracy than the defense of the budgets of thousands of families and businesses. The bottom line is that some citizens may no longer trust the Commission and its ability to manage the City’s funds and our taxes.  In any case, it has be useful to all that the City has published these letters.

THIRD EDITION

Separating Fact from Fiction

FROM YOUR CITY GOVERNMENT

Some community publications and groups have now resorted to using scare tactics to influence their readers. These tactics have no place in Coral Gables or in any rational discussion of the issues. It is amazing to read how these email blasts pretend to inform, yet portray the City’s financial difficulties as a result of matters unrelated to the worst economic downturn in a generation. Think about it, not a single word, not one, makes reference to the impact this economic crisis has had on our City. As we continue to work on the proposed budget and how it will address our community’s future, getting the whole picture is essential. There are many erroneous statements being put forth which deserve response. However, in this third edition of Straight Talk, the City addresses some of the most blatant misinformation and provides residents the facts.

Fiction: Our commissioners have budgeted a millage rate increase of 18.9% for services in Coral Gables.

FACT: The millage rate necessary to generate the same amount of property tax revenue for the City of Coral Gables as the current fiscal year is 5.537 mills per $1,000 of taxable value. The difference between 5.537 and the preliminary rate of 6.243 is .70 mills, a 13% increase. This does not mean the Commission will adopt that millage rate, but it does establish the maximum rate which can only be reduced. In fact, a millage rate as low as 5.995 has just been presented by staff which represents an 8.27% increase. As recent as fiscal year 2007, the millage rate in Coral Gables was 6.150 mills before being reduced in subsequent years. The City will hold any millage rate increase to a minimum. It is worth noting that our neighbors’ millage rate in the City of Miami is 50% more than our proposed rate. At 5.995 mills, Coral Gables would have one of the lowest rates in Miami-Dade County. Furthermore, out of the total amount of property taxes you pay to the Miami-Dade County Tax Collector’s Office, 38% is directed to the Miami-Dade County Public School System, 32% is directed to Miami-Dade County, 27% goes to the City of Coral Gables and the balance is sent to the State.

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Fiction: Who knows if the $50 a year fire rescue fee will be raised to $350 or $500 next year?

FACT: The only intent of statements such as this one is to unnecessarily alarm. Raising the Fire Assessment Fee from $50 per resident household annually to $350 or $500 is simply ludicrous. The flat fee would be used to pay for a portion of the costs and improvements for fire protection services to properties in Coral Gables. The funds received from this assessment would be dedicated to fire protection and assist in upgrading the City’s aging emergency fire trucks and equipment. These dedicated funds cannot be legally used for any other purpose.

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Fiction: We’re advised to bite the bullet and pay more, without any indication that the core issues of the problem have been addressed.

FACT: City leaders have spent the last several months evaluating the City’s financial condition and making strategic cuts that would minimize the impact on services provided to the community and put us on a path toward financial stability. The City of Coral Gables’ proposed budget for fiscal year 2009-2010 goes right to the root of the problem and provides solutions that mirror the belt-tightening that citizens are making in their daily lives. City departments have slashed their budgets and many dedicated employees will, unfortunately, lose their jobs just as members of our community have lost theirs. The proposed budget eliminates 64 positions. It should be noted that 20% of the full-time positions being cut come from management, professional and technical employees, yet this group makes up only 15% of the total workforce. The budget also calls for a total of 828 employees, approximately half are public safety personnel. That’s fewer employees than the City had a decade ago (830), yet over that same period of time the City has increased the number of police officers by 10%. A 5% reduction in salaries is proposed for remaining employees. The measures mentioned above, along with other personnel changes, will reduce costs by more than $5,000,000 annually.

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Fiction: Our perilous pension system could actually take Coral Gables into bankruptcy next year.

FACT: It’s no secret the City must and will make changes to its pension plan. It has begun the most significant restructuring of the pension system in the City’s history. Recently, City officials addressed pension reform. The contract with the union representing Coral Gables Police had expired and was up for renegotiation. As part of this City’s actions, your local government will be implementing several cost saving measures that will have a positive impact on the pension system. Police will start contributing 5% of their salaries to the pension plan along with other cost reducing changes. The City is making progress and will keep pension cost reduction a high priority. It is worth noting that the City does not have the ability to simply make unilateral changes to the pension system and must negotiate changes pursuant to State law.

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Fiction: The concession that they got from the police union was that the police employees would pay a 5% contribution to their own pension plan. This [the City]… considers being a victory.

FACT: A 5% contribution is a significant concession that will reduce costs to the pension system by approximately $775,000 a year. This is not the only concession received from the union representing Coral Gables Police Officers. In addition, the City reduced annual merit increases by half, from 5% to 2.5%. Merit increases, which are based on performance, and other changes made to the pension plan will save an additional $720,000 for a total cost reduction of nearly $1,500,000 annually.

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Fiction: The pension plans must be abolished.

FACT: Police officers and firefighters put on their uniforms and leave their homes and beloved families not knowing whether they will return. These dedicated employees are the first to respond to your calls for help. They defend, protect and care for our families at all hours of the day and in the dark of night. As already stated, reigning in pension costs is on the table and being implemented, doing away with the retirement plan of our dedicated men and women is simply not.

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Fiction: What are they doing to cut $4,000,000.00 from the failed and disgraced I.T. department and outsource it for $500,000.00?

FACT: The Information Technology Department has a total proposed budget of $4.6 million, a 15% reduction from the current budget. The department is responsible for a computer system and network of 850 PCs, laptops, tablets and mobile data terminals including some 200 devices used in the field by Police, Fire, and Emergency Medical Services personnel. In addition, I.T. maintains approximately 190 software applications as well as more than 115 servers, routers and local area network switches. The I.T. Department makes it possible for the City to operate and for employees to do their jobs. The thought of being able to support Information Technology operations 24 hours a day, 7 days a week including the purchase and replacement of equipment and software for $500,000 is a fallacy. If there is a company that provides comparable services and necessary replacement of equipment and software, the City would jump at the chance to pay only $500,000. The City will be evaluating all of its operations, including I.T., in order to reduce costs further, but to suggest a savings of this magnitude is simply disingenuous at best, and intentionally misleading at worst.

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Some individuals call for more cuts, yet they oppose reductions to vital services. So far the proposed budget has not reduced the number of police officers, firefighters or paramedics. Currently, 55 cents out of every dollar spent from the City’s general operating fund goes toward public safety (Police, Fire and Emergency Medical Services).
Discussion regarding the budget is about more than just dollars. After you’ve lived in a community for a while, you (hopefully) develop an attachment to it and even a sense of civic pride about it. You are comforted by the familiarity of it, and you want it to thrive because in many ways, your fortunes are attached to the fortunes of your community. As a resident you may wish to give thoughtful consideration to what’s important to you which, at its heart, should also be about: What makes up a community? Is it just its people, or is it also its places, its institutions and its quality of life standards? Does it remain the same community if you begin to gut its institutions and change its standards? No matter where you live in Coral Gables, your city government is taking this time to consider the dismal economy and what our community can afford to maintain and what it can do without. As we have already stated, the discussion should not just be about dollars; it should also be about what constitutes a community and what makes it a place where you and others want to live.

About Stephen E. McGaughey
International consultant in financing development programs and projects

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