Sunday, September 30, 2012

The Budget and Compromise

On Thursday, the commission passed the final tax rates and approved the budget for 2013.   

Our millage rate remains the same at 4.77 plus the debt millage.   It is looking like our precipitous drop in home values and tax revenues may have stabilized.   

The budget process was healthy and I hope the start of a new way of doing policy in North Bay Village.  

First, the only really new expenditure is $130,000 for the International Baccalaureate program at Treasure Island.  There was much discussion about this item.  Miami Beach was the only city in the United States to adopt the IB program at all elementary and middle school levels and has had positive results.  Treasure Island joins the program next year which I believe is an important step forward.   

Not everyone agreed.  One long time resident with a deep understanding of budget issues had two major concerns.   The first was how to fund the program because there is little doubt that we have to find the money or raise it through fees/taxes.  The second was a belief that this issue should be brought before the voters in a referendum since it affects the residents financially and educationally.   

Those concerns did not prevail and the commission kept the IB in the budget. 

Then something cool happened.  The commission deadlocked.  The mayor had prematurely called the budget to vote and two commissioners, Blumberg and Chervony, voted No.  There was a glimmer of panic and then a discussion happened that should have happened before.   

The major concern that Chervony and Blumberg shared was that the reserve of $238,000 for operations was too low.  The proposed solution to that concern was to move several items from approved to a contingency account that brings the reserve to $400,000.  This is a very good idea and one that our budget process should continually practice.   

Items in the contingency account are understood to be goals.  But their execution depends on other status.  So in this case, if the reserve does not meet the $400,000, the item will be deferred.  If it does meet the goal, a resolution by the commission will free up the money.  Not so different than how a household budgets.  

After some discussions and clarifications, this approach, which was not even a compromise really, passed.   

This is the right way for the commission to proceed - agree the priorities and then find the way to get there.  

That the IB program was intensely analyzed, studied and questioned is healthy for our city.  Over the next year, I hope we can bring the same level of scrutiny to the 600 lb. gorilla, the police budget. At 67% of our budget, we need to make sure we are getting the value for what we spend.  

Kevin Vericker
September 30, 2012

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