Corinth MUD #1 Update

The January 24 Corinth MUD #1 board meeting has come and gone - and the board did NOT pass a resolution to dissolve the MUD. I recall that after the City Council voted to dissolve the MUD, and the MUD went out and passed around a petition to reinstate the MUD, the board suggested that if we (the council) would repeal our dissolution ordinance, they would dissolve the MUD on January 24th. They didn't.

Cut taxes, but not my benefits

That seems to be the confusing, and untenable, position of many people today. I just read an article in the NY Times and its accompanying poll that asked questions about how to cut the deficit. It seems that most people understand that you can't just keep borrowing money from the future to pay for things today. However, when asked what they are willing to give up to reduce spending, the answer is "not MY benefits".

Budget 2011 - First look

October first started the 2010-11 fiscal year, and the 2010 budget. Unfortunately there was in increase in the tax rate from .57698 to .59292 which was an increase to the effective rate. Property values declined overall in the city from $1,393,914,517 to $1,368,721,005, about 1.81%. There was also a decline in sales tax revenue at the same time, which is no surprise given how the economy was going.

The Budget - Again

It seems like we just approved the 2010-11 budget... We did - 4 months ago. So now, it is time to begin the process again to have a budget ready at the end of September 2011. The first budget meeting between the council and the city staff generally occurs around mid February, about a month away. At that time Council will receive a best guess as to what resources (taxes and fees) we will have available given current tax rates, then we will have to provide guidance to staff as to how to proceed to prepare the budget.

The budget process is both simple and complex at the same time. It is simple in that by law we cannot borrow money to pay for operations - we can't spend more than we take in. It is complex in that each resident has a possibly different priority for what we should spend money on. It is very simple and easy to grow the budget (just keep adding expenses!) - it is orders of magnitude more difficult and complex to cut the budget.

If the expenditures exceed the revenues (as occurred the last two years), then there are but two choices - reduce the expenditures, or increase the revenues. It has often seemed to me that the choice is made to increase revenues. Property taxes represent about 50% of the city's general fund revenues. Sales tax is only about 7.4%. We have little to no direct control over sales tax revenue - people's spending does that.

So when the city "needs" money to balance the budget, it just increases the amount of property taxes. This often irritates the people who have to pay those property taxes.

To be fair, people expect a certain level of services from a city - that is what the taxes are for, after all. So rather than calling to cut taxes, or cut spending, or increase taxes (or search for new sources of revenue), I propose that we determine what is the proper level of services for the city to provide. What is the required staffing to provide those services, and what is appropriate compensation for the city employees given the state of the non government (private sector) economy?

That is the complex part - every resident has a different opinion of what constitutes the proper level of services from the City. So over the next several weeks, I intend to discuss here each service and department in the city. I will greatly appreciate input about what residents expect, and what they are willing to pay for.

First Order of Business

Well, it has been a long time since my last post. A lot has happened since then. Our gas well committee wrapped up its proceedings, the council passed a new gas well ordinance, finished discussions on and passed the 2010-11 budget, a new tax rate, abolished the Corinth MUD #1 (only to have it resurrected by a voter petition), approved a zoning change for the property the old Boeing building sits on, and a myriad of other decisions.

The new gas well drilling ordinance, budget, and MUD issues were each big and somewhat draining.

And then there was the holiday, some time to spend with family. I hope everyone had the chance to spend some time with their families over the Christmas season. And now we are on to the new year - more with Corinth MUD #1, and the budget again.

Oh yeah, the Texas Legislature has just convened. Hold on to your wallets and property.