Wednesday, July 28, 2010

Budget Meeting Tonight July 28 at 7:30 PM

The full commission will be meeting tonight, Wednesday, July 28 at 7:30 PM, to discuss the plans for the 2011 budget. Most of the topics regarding the budget seem arcane and highly technical. That's because they are. That doesn't make them less critical to understand for the average North Bay Village.

The process will break down into roughly two categories, short term and long term. There is overlap but a useful way to look at this is short term refers to the revenues and expenditures to keep the city functioning day to day in fiscal year (FY) 2011, while long term refers to the development efforts to stabilize and improve the city in the future.

Short Term: by now, I think everyone who has been paying attention knows that North Bay Village is predicted to drop 26% in ad valorem tax revenue, the second worst decline in the county. Homestead had the worst. Overall values have fallen, new sales are lower than they have been in years, according to Trulia.Com there are 258 units for sale in various states of foreclosure, homes bought during the construction boom have been significantly reduced in value. This drop is likely to result in at least a 20% reduction in money available to the city to keep running.

Local services, principally the police but also maintenance and other city services, will be reduced, and taxes on homesteaded older homes will probably rise. The question tonight is what services and how much will be the new taxes be.

Three of the five commissioners, Rey Trujillo, George Kane and Dr. Vogel, have demonstrated a scandalous lack of fiscal discipline and these three constitute the majority.

George Kane saw nothing wrong with proposing and lobbying for a personally profitable deal to move city hall to the Lexi, a move that will bring zero value to the NBV taxpayer, but entitled him to a commission. This action remains endorsed by our full commission, all five members, since not one has offered even a token resolution of disapproval.

Rey Trujillo's impulsive actions of firing then doubling the cost, have brought the current strained budget to the breaking point. The North Bay Village Trujillo Tax is hurting us now and if it continues, will drives us to bankruptcy.

Dr. Vogel has sadly gone along with these shenanigans.

These guys need watching to make sure they get it right. They have not demonstrated that they understand fiscal restraint in a relatively tight situation. It's going to get worse as the revenue deteriorates.

Long Term-We are in this mess for two big reasons. Our tax base is out of balance. We rely too heavily on one source, property taxes. Over 70% of our revenue comes from property and relatively minuscule 10% from businesses. This model is unsustainable. We can see it now. A downturn in property values has a dramatic effect overall on the revenues.

The second reason is that North Bay Village's biggest current investment, the police department, is not controlled for spending. You know all the examples.

The commission again needs watching since they have shown little inclination to bring the PD back to reality. A simple cut of $350,000 ordered by the commission has not been met and this does not bode well.

I think the same troika does not get the balance between the short term and the long term. If you remember the firing of Matt Schwartz, these three spoke in glowing terms about Schwartz's ability to create the critical capital projects that we need to keep us out of the exact sort of dilemma in which we find ourselves. It was clear that they did not find building the future nearly as important as their current annoyance with the CM, over the police, at least publicly.

Finally, and of grave concern to all of us, remember that there is somewhere over $30 million dollars about to flow through North Bay Village. We already know that we have a vice mayor who sees no ethical conflict in helping himself to a profit out of city funds; we know that our city commission does not consider this worthy of censure; we have a former vice mayor who feels entitled to double our expenditures every time someone displeases him. This does not bode well for proper oversight.

Two bright spots in all of this are the new police chief, who is showing clearly that he understands the need for fiscal and departmental discipline, and the interim city manager who is trying mightily to pull all of this together to a comprehensible presentation. Two alone are not enough to keep the tide in check though. Citizens have to be there. It's our money.

Kevin Vericker
July 28, 2010

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