By Robert L. Style This particular budget is more difficult to analyze due the annexation. Annexation revenues are listed on page 49 but some, not all, of their expenses are. Some annexation expenses are listed elsewhere on Page xxv as the Annexation Service Package Request. I also could not find the anticipated state tax rebate which is far less than what was originally proposed.
Because of annexation, it is difficult to determine just how much the budget has increased. What is clear is the Council will be spending a greater share of our money on providing services to the annexation area. There will be a budget decrease of 13% that we will be expected to absorb so the annexation area can be served. As predicted, we end up paying more for less.
Even with the Council crying about how the bad economy impacted the budget, they still had an increase of $27 million over the budget they adopted last year. It’s not that the city doesn’t have the money. They continue to overspend even now during bad economic times.
Here are specific issues why our Council is not to be trusted to be accountable to the citizens of Kirkland.
Page ii: Upper left paragraph: Last Sentence addressing service level reductions reads: “That trend continued in the reductions that were made in 2010 related to the failure of the private utility tax increase vote.”
It’s what the Council wants you to believe. It’s not true. The service level reductions came about because $2.2 million dollars was transferred from the general fund to pay for annexation ramp up cost. By doing so, the Council voted to force the current population of Kirkland to pay more for reduced services without a vote of the citizens.
The proposed private utility tax increase was going to be 14% on top of a 13% increase in private utility tax the Council already approved as listed on page 99 of the budget report. Again, the citizens did not get to vote. If the proposed ballot measure passes, it would have raised the private utility tax by 27% and placed an added burden on all those on fixed income including senior citizens and renters particular those living in affordable housing. However, the Council didn’t care and put the 14% increase on the ballot anyway. No wonder the ballot measure failed. As it is, last year’s utility taxes have gone up 19%. The proposed 2011-2012 budget increases the utility taxes by 21%. If the budget is adopted as is, over the last 4 years utility taxes will have increased by 37% and there’s no end in sight. Council has expressed an interest in raising them even more.
On the same page ii left hand column, the proposed budget includes two new revenue sources: Emergency Medical Services (EMS Transportation Fees) and a Transportation Benefit District (TBD). Both should not be adopted. The EMS transportation fees were already considered when we passed the EMS levy. This would add to the cost we are already paying for the EMS we receive. To impose a transportation fee on the citizens only adds to the cost of insurance on the individual, something the Obama administration has chosen to misconstrue. He says our health Insurance cost will go down. He’s wrong. From the proposed one percent financial transaction fee to the 3.8 percent added capital gains tax starting in 2013, even the sale of house is included and will be taxed even more. Emergency Medical Services fee should not be adopted.
The proposed TBD will increase our vehicle license fee by $20 and used to enhance current road maintenance. Since roads are a primary function of government, Kirkland should fund road maintenance just after they fund the police and fire departments, and before parks. The $20 fee would not apply to those who live outside of Kirkland who use our roads to get to and from home. What about commercial traffic? Will trucks and busses also be required to pay the $20? The Council should maintain our roads. If the Council wants more money for other projects, let them put those on the ballot. The TBD cannot be applied to everyone using our streets. It discriminates against those living in Kirkland and should not be considered.
At least the proposed budget acknowledges that the annexation area did not contribute to making up the shortfall needed to be closed to balance this budget. We’re talking millions. It brings up the following questions.
If the Council goes out for the proposed $35 to $40 million dollar bond, will it be a
Councilmatic bond the citizens don’t get to vote on or will it go on the ballot. If it goes on the ballot before the annexation effective date, will the debt also apply to the annexation area? Why is the bond necessary? Will all of the bond money be used for the annexation cost or will it be used to fund other accounts? Hopefully it will reimburse the “loan” from the utility fund, a fund that has risen to more than $13,422,459 (page 99).
I have not found where the proposed income from the bond is accounted for or what expenditures will be financed.
Page iii: Top left hand paragraph addressing replenishment of reserves.
Replenishment of reserves is important. However, it should not exceed the 5% (page 55) has set as the target goal. Anything more than that, the Council has taxed us too much and will have earned the distrust of its citizens. The Council has typically busted the budget exceeding what they promised its citizens. It needs to stop. Our current adopted biannual budget has been exceeded by about $27 million and is consistent with the average being $13 million per year. Doesn’t the Council know about the depression?
When the Council adopts a budget, it tells the citizens it can run the city for the adopted amount. It’s a promise that if not followed, the Council’s accountability is in question. In past years we’ve had a surplus exceeding $13 million a year most of which has been spent. The reserves are low and with good management, can be increased without additional spending with associated higher fees and taxes.
Still on the left column of Page iii, expansion of City facilities is discussed. Money is being used to buy more parks and to incur the additional debt that comes with them. Rather than reducing debt, the Council wants to increase it. Our debt needs to be reduced. The money used ($225,000) to buy the park comes out of the REET fund, a fund that has a current balance of more than $6 million dollars, money that could be used to pay for the capital improvements needed for the much larger city that we have become. It should be used to reduce our debt instead of increasing it.
On page iv: left column discusses “Normalization.” What is that, another term for excusing responsible accounting? It opens the door to even more juggling.
On page iv: right column discusses a comparison with other cities. It’s ironic that Kirkland and the Finance Department get awards from government agencies that tell them how well they are doing in picking the pockets of its citizens. It’s not surprising. Almost all staff come from the same school and are inbred to produce the same results.
On page iv: right column discusses the downward trend of Sales tax revenue. Why then is there a 26% increase in the General Fund? Shouldn’t it go down also?
On page v: right column discusses Parks Maintenance Fund and says that property tax is the sole source of income. Almost every other service provided has a fee for service. Why not parks?
Not everyone uses parks. When trying to establish a sustainable budget, all sources of revenue should be considered. As long as the city likes to compare itself to other cities, then don’t exclude the other cities across the nation that charge fees for using their parks. Besides the cities, many state and federal parks are funded with fees.
The same column discusses the growing share of Utility Taxes in the General Fund. It now amounts to more than $19 million. And, it is growing. I’ll say. As a discretionary fund, the Council has taken the liberty of increased the fund by 37%. They raised the fees anyway without a vote of the citizens. They don’t care about the consequences to the citizens who have to cover the cost.
Page v: Right column discusses Business license fee. If the Council wants business in Kirkland, do away with the fee. Sales tax revenues just might go up because of it and we just might prevent the loss of businesses. Recently, the State of Texas as well as the State of Idaho have sent out letters to businesses in our state saying if you don’t like your taxes, come to us. It’s time for our elected officials realize what it takes to be in a competitive market.
Page vi: right column, Expenditure Trends discusses inflation and the CPI. The report fails to acknowledge the sacrifices that businesses and family members have made in order to survive. They are cutting costs. So should government. There has been no increase in the cost of living increase for two years. Accordingly, the Council should not increase their budget. We should return to the revenues available in 2007 and live within our means.
Page vii: Left column discusses Expenditure Reductions. I think the term “cost reallocations” needs to be explained. Just how much juggling can we stand?
Page vii: right column discusses key program impacts. While the paragraph about the City Manager’s officeacknowledged some reductions, the report does not acknowledge the “Core” values that the citizens want and how to pay for them.
Surveys of the citizens were conducted by the Kirkland Views and the Kirkland Reporter. Both indicated that the City Manager’s office should not be exempt from the reductions needed that would enable the Council to create a sustainable budget. Toward that end, the city manager’s department is overloaded with expensive staff that is not needed to run the city. They serve management, not the people.
The survey also indicated the citizens would be comfortable with doing away with many boards and commissions. Much too much time and money is spent serving special interest. Citizens should be able to come to the Council regardless of association. After all, they are citizens of Kirkland with Councilmembers they elected to serve them.
In short, the City is top heavy with expensive management from the City Manager’s office on down. If only a few of those positions were done away with, many more city workers that directly serve the public would not lose their jobs.
If left up to staff, their budgets would not be cut; so, it’s up to the Council to make the tough decisions. If they do not, even more service packages will be submitted that will increase our debt. Citizens can be and should be served. Citizens should not be serving government.
The city manager has excellent qualifications. He has a silver tongue along with the knowledge how to use it. He should not be denied the opportunity to use his ability to insure efficiency. Therefore, there would be nothing wrong for him to use his qualifications to manage the city the way it use to be with input from the well qualified and well paid department heads. He needs to earn his money.
Before we had a communication specialist, a spin doctor, we had a manager that compiled the concerns of department heads and staff. The citizens were aware of what was going on in the city. The manager was more accountable. Now we have a Communications Program Manager that does not manage anyone but herself yet is getting the salary and benefits of a manager.
An Intergovernmental Relations Manager is like the Program Manager, one person that has created budget expenditures to regional programs that return far less benefits that we could have if we didn’t export the money to outside agencies. (More on this subject later in my comments about Page x of the report.) We even pay lobbyist at the state for ways to increase our fees and taxes.
We also have an Economic Development Position that has produce almost nothing in economic development, Google and Park Place exempted.
We have a Neighborhood Services position that caters to organizations that seek to promote their own interest. All those neighborhood meetings require lots of staff time and money to get their feedback that is usually is ignored by the Council if it is not in their interest. Only one public hearing is required on most issues. Anyone can express their concerns at that hearing. We do not need multiple hearings. Even before a hearing, Councilmembers develop their own desires and communicate with those who make it possible. Their decisions are made up ahead of the hearing. We’ve seen it too many times. We are not using staff’s time and money wisely.
In total, if positions that serve management were reduced, about a half million dollars could be saved. If the Manager lived up to his qualifications, the citizens would not be impacted. He needs to earn his exorbitant salary. If he does and the right people were let go, the city could unlock the bathroom doors at our parks, maintain the streets and landscaping, empty the trash cans, and rehire those who were laid off due to the budget shortage. They should not have been laid off. A few top heavy management positions should be.
Too many consultants are hired to supplant, not supplement staff’s judgment and responsibilities. We have highly paid staff that needs to step up to the plate and be accountable for their decisions rather than hiding behind a consultant that is doing their work for them.
Page vii: The left column talks about Planning and Community Development. The Deputy Director and another long range planner could be dropped without any serious impact on city services. Attendance at regional meetings could be reduced. Because of the drop in building permits, a current planner could also be dropped until we get out of the mortgage mess.
On the same page & column, facilities are discussed. REET funds should be used for something else besides parks especially when we need the money to reduce our debt.
Page viii: right column discusses Service Packages. Council should make sure that all service requests meet the criteria specified by the City Manager. As it is now, creative budgeting is allowed to replace reason and logic as long as it satisfies the Council’s special interest
Page ix: left column talks about one time spending. One time spending is repeated every year and should be funded annually.
On the same page in the right hand column, other recommendations are discussed. Community surveys are not necessary every two years. The results always come back the same. The survey questions are carefully reviewed, scrutinized, and worded to produce desirable answers.
The city’s budget for ARCH should be reduced. Affordable housing is a county responsibility, not city’s. The more affordable housing a city has, the greater the debt because those living in affordable housing don’t make enough to pay for the services they receive. Just ask Miami-Dade County about being on the brink of bankruptcy because of too much affordable housing.
Page x: The right column discusses annexation service packages. It should also mention the money borrowed from the Utility Fund and how it’s being used to pay for services before the annexation area revenues are received. It needs to be replenished. The city had a study session about debt management whereby staff suggested the issuance of a $35 to $40 million dollar bond. Where’s that money going?
In the same column, funding for outside agencies was discussed. After review of what the city contributes to outside agencies, it was discovered that we only get back about a third of the money we put in. The money going to King Count for surface water management, particularly flooding, is more than a million but we only get back 10% or $100,000. Regional funding needs to be reduced. The money could be better spent is we used it for ourselves. We could use the money.
The projected budget of $434,849,941 includes $48,494,900 of annexation revenues to cover their expenses which means the citizens that elected you will have to absorb a 13.23% loss in services. We are being short changed. We elected you to represent us. You did not and are not doing it.
A majority of our Councilmembers are an embarisment to the democratic process. A few are not. The majority is not listening to the citizens they serve.
Before I leave, I want every citizen to see what is happening to their money. See cartoon below.
Robert L. Style