September 28, 2021

Workshops Streamline Budget Adoption

The perhaps surprising takeaway from Council’s adoption last week of the fiscal year 2022 budget is how little discussion there was, and how few amendments were offered, before the final vote.  Of course, Council had previously spent long hours thoroughly reviewing and debating various aspects of the draft budget through a series of workshops, and in doing so certain cuts had already been made.  There’d been a lot of talk about further cuts, setting the stage for a contentious vote, but ultimately when the time came virtually none were proposed, even by those who voted against the budget.  And of the two that were, the one amendment that didn’t pass represented less than one half of one percent of the total.  Overall, the process worked and led to a fairly straightforward outcome.

The adopted budget preserves the same nominal tax rate we’ve had the past two years, $0.4473, a 1.73% increase over the effective (no new revenue) rate.  The impact on individual taxpayers will vary according to their appraised values and exemptions, but for a home at the average value in Bellaire of $928,035 with the standard homestead exemption, the difference will be $56 year over year.

This budget also implements the results of the user fee study and cost allocation plan, although conservatively assumes only half of the new fee revenues projected.  In future budgets we’ll be able to more accurately account for those revenues once known, in order to fully realize the benefit of ending inappropriate taxpayer subsidies.  In the Enterprise Fund, utility rates are adjusted to keep up with the costs of providing services, including the increased annual overhead transfer to the General Fund.

Public input on the budget was overwhelmingly focused not on operating expenses, but in support of capital projects:  restroom facilities at Mulberry Park, the Evergreen Park Master Plan, and improvements to the dog pound.  The Mulberry Park restroom is budgeted for the coming year, albeit at a reduced amount, to better signal Council’s intentions and expectations of what it will ultimately cost.  The new Evergreen Park and replacement of the dog pound both remain in the Capital Improvement Plan, as projects identified for future years.  However, staff will continue developing for Council’s consideration potential alternatives to address the dog pound sooner.

As noted, by the time of budget adoption certain spending cuts had already been made by consensus direction in Council’s earlier workshops.  Most prominently to the restructured employee pay plan, the product of a comprehensive review and update for both market competitiveness and internal equity.  The new plan disproportionately favors the lowest pay grades, while raising minimums across the board to avoid grade compression.  Council cut the FY 2022 impact by more than a third, but maintained the plan’s emphasis on providing the greatest benefit to those making less than $15 an hour.

The other significant line item nixed from the budget was a request from the Fire Department for staffing our reserve EMS unit at peak demand.  Council declined to include this item as presented, but expressed an openness to hearing more once the details are fully fleshed out.  (It’s not uncommon for such proposals to be only preliminary at budget time; there's a difference between appropriating funds and actually spending them.)

That there were no further cuts forthcoming at the time of budget adoption is an indication that the process worked and that our considerable investment of time in the months leading up to it was worthwhile.  Sure, not all Council members were going to vote for the budget, but each had numerous opportunities to influence its direction and to propose whatever cuts they wanted to make.  Staff once again did a commendable job compiling voluminous responses to Council questions and information requests, and incorporating the feedback received.  In the end, we’ve got a good budget that’s reflective of all the effort that went into it.