FY 2010 Budget Proposal

FY 2010 Budget Proposal Download
Use of St. Petersburg City Surplus Funds

ST. PETERSBURG, FL (June 16, 2009) – With a platform based on a commitment to open, affordable and accountable government, mayoral candidate Kathleen Ford today announced her plan for the City of St. Petersburg budget for the fiscal year 2010.

The Ford budget is focused on three issues:

1. Cutting residential and commercial property taxes: The Ford budget would see a residential and commercial property tax rate reduction of .5 mills - a reduction of 8-1/2 percent. According to City budget numbers; this would be the largest non-state mandated property tax decrease in St. Petersburg in at least a dozen years.
2. Bolstering public safety: The Ford budget would add $500,000 to the Police budget and an additional $500,000 to the Fire Department budget. The money would be used for additional personnel or much needed equipment.
3. Funding non-management City positions that directly provide services to the citizens of St. Petersburg: The Ford budget will keep the general wage increase for non-management City employees and merit increases including honoring the union contracts. It will also add $300,000 to the budget to restore some of the personnel cuts made by Mayor Rick Baker this year – including the Cultural Arts Manager as well as other positions to be determined on a case-by-case basis.

“The residents of St. Petersburg have made it clear that next to lowering property taxes, public safety should be City Hall’s priority,” Ford said. “For years I have been saying the Police Department needs more officers on the street, recently we have learned that the Fire Department also need more personnel for fire trucks.”

To fund these three budget priorities, Ford’s offers a two-step plan to shore up the City’s long-term financial health.

Step 1 – reshape, reorganize and reduce the current top heavy bureaucracy.

Under the Ford budget, the City will streamline its organization by consolidating activities and reducing overlapping staff responsibilities. Unlike past administrations, Ford’s consolidation will see cuts at the top of the organization, not the bottom.

By making the City organization leaner at the top, St. Petersburg’s government will function more efficiently and effectively, while projecting a savings of over $2.2-million a year.

The Ford budget will also reduce the salary of the remaining top management officials. The City of St. Petersburg now has 64 employees who make over $100,000 a year. The average household income in St. Petersburg is $54,655.

The Ford budget will reduce the salary for all management staff who make over $90,000 annually, including the Mayor. This is in addition to the salary rollback of 2.5% recently enacted by Mayor Baker. City staff making over $100,000 will receive a 10-percent reduction. Staff making $90,000-$100,000 will receive a 5-percent reduction.

This reduction will save the City $720,000 a year and bring the salaries of management more in line with the salaries of their employees, as well as the citizens that they serve.

“Is it reasonable that a Manager making $90,000 needs to report to a Director making $110,000 who reports to an Administrator making $140,000 who reports to a Deputy Mayor making $156,000 before a decision is made?” Ford said. “To use the Police Department as an example, the Chief is not the most important employee in the department – it is the officer on the street. That is the philosophy we need throughout the City Administration.”

Ford’s plan will also institute a city-wide program to review all expenditures, especially contract administration in the Purchasing Department, to ensure taxpayer’s dollars are not being wasted.

Step 2 – Releasing excess surplus funds. Why is the City becoming cash rich when its residents struggle?

According to the City of St. Petersburg Budget, there are several City funds with surplus balances. The total amount of the surplus – meaning more money in the fund than is necessary – is $58-million.

“For a number of years, according to the City Budget, the City has been saving for an economic rainy day,” Ford said. “In terms of bad economic news, it’s pouring in St. Petersburg.”

Of the many funds now carrying a surplus, the Ford budget plan propose to utilize only four. In just those four funds, there is a surplus of $38-million.

One of the funds – the Economic Stability Fund – was, according to the 2009 City budget, created “to offset economic impacts on the budget from significant or sustained increases in expenditures or significant decreases in revenue.”

The Economic Stability Fund has a surplus of over $16-million – the Ford budget plan proposes to use only $12-million. The economic situation the city faces in fiscal 2010 is exactly what the Economic Stability Fund was created for.

“With a loss of nearly $12-million in property taxes, if we are not experiencing a significant decrease in revenue right now, I don’t know when we ever will,” Ford said. “Why isn’t the current administration using this fund to help balance the budget instead of planning to transfer another $6-million into it from the General Fund?”

Nearly 45-percent of the fund balance comes directly from the General Fund and Excise Taxes – which is mostly our citizen’s money in the form of taxes.

The other surplus funds identified in the Ford budget plan include:

• $3-million from the General Operating Fund – leaving a balance of $22.4-million
• $3-million from the Local Option Tax Fund – leaving a balance of $3.9 million
• $2-million from the Equipment Replacement Fund – leaving a balance of $16.8-million

In total, after using just part of the surplus to help balance the budget, the four identified funds will retain a balance of $47-million – this includes a surplus of nearly $19-million.

“I support the City’s policy of not using one-time monies for reoccurring expenses, but this policy does not apply to using surplus funds to help offset the significant decrease in revenue we are now experiencing,” Ford said.

“I am convinced that other surplus fund balances throughout the City budget, together with my goal of reducing City operating costs by implementing an efficient government, will allow us to balance the budget for the next several years while keeping us well prepared for a possible natural disaster.”

The current city administration has released its budget plan for fiscal year 2010 which shows a deficit of $14.6-million, to be balanced with selected fee increases for city services and departmental expense reductions that will negatively impact our citizens.

“There should be no doubt that by lowering property taxes, cutting bureaucratic fat, tapping surplus funds and strengthening public safety – my budget plan will make St. Petersburg a stronger, safer and economically responsible city,” Ford said.