|Budgeting Process Update|
At the first meeting of the 2021-2023 budget process, Finance Director Melanie Purcell told the Citizen’s Budget Committee she foresees structural deficits doubling in a couple of years to more than $5 million — in fact, she sees deficits through 2026.
You’d think the Budget Committee would have its hands full. After all, by state law, the Budget Committee is required to recommend to the City Council a balanced budget.
Instead, at the first 2021/23 biennial budget committee meeting, three members, Jim Bachman, Bob Kaplan and Steve Jensen, threw up their hands, asking what the committee can possibly do when policy decision are made by the council, not the Budget Committee, suggesting that Citizen Budget Committee members’ ability to make recommendations to cut spending are quite limited.
ACES says hogwash. First, while the Budget Committee doesn’t make policy, it does have the authority and responsibility to make recommendations on how much is spent on those policies. Second, our expectation and that of Ashland’s citizens is that every member of the Budget Committee will propose deep and meaningful cost-cutting measures and, if policy changes are required, the council will step up and vote to make those policy changes!
We had high hopes that the new Budget Committee would be prepared from the start to take a hard look at city spending, particularly when a growing “structural deficit” has been identified with expenditures exceeding revenues for years to come. Immediately after the budget was officially presented, however, Jim Bachman, the vice chair, commented, “Policy versus what we can do has never been really clear to me.” There was also confusion on his part as well as for Bob Kaplan, as to what a “structural deficit” is in a budget.
For the budget committee members who don’t know what it means, here is an excellent definition provided by Adam Hanks: A “structural deficit” occurs when “the existing revenue streams in the general fund are insufficient to cover the existing and forecastable expenses in that same fund”.
The state’s purpose in requiring citizen members of the Budget Committee is to ensure city councils are operating in a fiscally responsible way. Ashland’s committee has 14 members including the mayor, six councilors and seven citizens with varying experience in budgeting and government. Having citizens participate is supposed to be a check and balance on the City Council and staff. However, former city elected officials and administration prevented the committee from operating in this capacity for several years and we see the result — a significant structural deficit in our city’s budget.
For far too long, the erroneous premise has prevailed that the Budget Committee shouldn’t address anything that might affect policy.
The clear message from Ashlanders to the committee is — dig in. Don’t overanalyze your job. Just do it.
Susan T. Wilson is treasurer of ACES