The economy has limited development, forced inflation and, most critically for the city of Lawrence's budget, stalled the housing market. No longer can city leaders count on property taxes for incremental revenue growth.
Belts have been tightened; the city spent less in 2007 than in 2006. But as the city plans for its 2009 budget, it is facing some serious troubles. For example:
¢ A slowdown in the real estate market has led to the lowest increases in assessed valuations in years. The city is not expected to receive any new property tax revenues in 2009, unless commissioners agree to raise the mill levy.
¢ The city's $55 million general fund is expected to grow only by about $850,000, or about 1.5 percent. Most of the new money is expected from a modest increase in sales tax collections.
¢ City departments need to budget at least a 20 percent increase in fuel prices.
What's next? Immediately, the need for more cuts to city services and better management of the money the city has.
The cuts on the table could include the T, Lawrence's public transportation system. City leaders say it will cost an extra $1 million, a 70 percent increase, in city funding to run the T in 2009 because of increased fuel and maintenance costs. The city's cost for the T this year is $1.7 million.
Rather than commissioners determining themselves whether to cut or increase funding for the T, Mayor Mike Dever is suggesting the decision be given to the voters.
That's cause for concern. Operational decisions such as the T should be made by Dever and the rest of the commission, while weighing a recommendation from city staff members. But the mayor reasons that the voters decided to create the T, now they should decide whether to keep it around. Isn't that what Dever and his colleagues are elected to do?
Putting such a decision before the voters more likely than not will produce a negative response. If less than 1 percent of the community is using the service, it's doubtful the majority is going to say "let's spend the bucks." All that does it put the blame on the T's demise on the masses. The commission would get a pass.
If something isn't working, fix it or move on. Or, better yet, find a less expensive and more efficient option of serving those who need the ride. For example, explore a city-subsidized voucher system that could provide cab rides.
Raising taxes isn't the solution to every problem. Finding new revenue sources is. A community, such as Lawrence, cannot continue to survive on the backs of residential property owners. Aside from running efficiently, the city's focus needs to be on economic development: attracting industry and creating jobs.
As far as efficiency, the city is on the right track with hiring Michael Eglinski, its first performance auditor, even if all he does is save the equivalent of his $87,500 salary each year. The city now has someone whose job is to scrutinize government's performance and find savings. His first goals are to seek savings from electric bills and purchasing to street maintenance and police service.
Let's hope commissioners act on Eglinski's money-saving ideas, instead of calling for an election on any tough decisions.