Budget season in the city is a good time for a trip down memory lane. The city leaders, or at least those showing up to the meetings, are actively engaged in a discussion about how to accurately project, and maximize, city revenues given our political realities.
The city budget dance is rather simple. The professional city staff are trying to provide complete and accurate financial information in a politically neutral way while demurely avoiding the intense political differences of the politicians who directly or indirectly employ them. The city council majority are trying to execute a political strategy without risking the financial integrity of the city. Those who oppose the majority are trying to puff up their minority political agenda and slow down (or stop) the majority strategy.
The opposition this year has either already said they will vote against the budget unless it contains unicorns and magic buses for everyone (Team Dave Snyder), or they are challenging the use of assumptions to construct the budget (Nader Baroukh). Go ahead and read that last sentence again. Yes, you got it right, our freshman city council member came into his first budget cycle not understanding the city budget is projected(rather than actual) revenue.
Let us all have a quiet moment in our heads for stammering and concern ...
All better now. So anyway, now let us look at how the opposition has done in the past on their mystery meat budget math. Remember 2004? The central issue was mixed use development at The Byron. The CBC-endorsed candidates (Gardner, Hockenberry, and Chavern) kicked off their campaign in the parking lot of the vacant Red Lobster to illustrate the importance of mixed use development as a way to revitalize the city from the disastrous vacant lot strategy of Snyder, and to emphasize the symbiotic relationship of mixed use (local population) with city center (commercial and community revitalization).
In 2004 the opposition, led by Team Dave Snyder who spoon-fed his candidates with bad data, focused on The Byron. The argument was city staff had wildly over-estimated revenue projections from The Byron and failed to account for a tidal wave of new kids flooding into the city. In a April 12, 2004 open letter to school parents, opposition candidate Lou Mauro warned mixed use development would require "... another $20 million plus school building to be started almost as soon as soon as [MEHS] opens its doors ..." and students who move into the city "... [will put] the quality of our schools in jeapordy" and "... cause teacher morale to deteriorate and threaten the quality of schools ..."
Let me pause here. Remember a few months ago my post on the effort by Mauro (and Baroukh's campaign manager, et al) to have Jim Moran, the DOJ, and other government folks launch a federal investigation against the city claiming the city was trying to discriminate against families with children? See how they worked the triangulation? They made a political argument against more kids moving into the city and then tried to have the feds investigate the city for allegedly discriminating against kids? Classic evil stuff. Well played ... repugnant ... but well played.
So time to look at how Snyder and the opposition did on their circa 2004 budget projections (source for the data below is the Falls Church City Economic Development Authority).
In 2003 the City’s fiscal impact model predicted net revenue of $306,436 per year for the Byron at full residential and commercial occupancy. The tax rate for real property in Falls Church in 2003 was $1.13 per $100 assessed value. Today, using a lower real property tax rate of $1.03, the fiscal impact model produces a net revenue figure of $473,971 per year for the Byron.
The updated calculation uses actual 2009 assessed property values, actual business, sales and meals tax information, and the very latest information from Falls Church City Public Schools on pupil enrollment for Byron residents. It should also be noted that all 90 residential units in the Byron have been sold and 73 percent of all commercial space in the building is occupied.
The table below summarizes the analysis:
BYRON NET FISCAL IMPACT COMPARISONS
|
YEAR OF STUDY
|
CITY ANNUAL NET REVENUE |
PUBLIC SCHOOL PUPILS |
PUPILS PER UNIT |
REAL PROPERTY TAX RATE |
|
2003 Estimation
|
$306,436 |
14 |
0.15 |
$1.13/$100 |
|
2009 Actual
|
$473,971 |
11* |
0.12 |
$1.03/$100 |
* Information provided by Falls Church City Public Schools, week of 02/02/09.
Do you see that? Even with a decease in the tax rate from $1.13 to $1.03, and a huge market slow down, actual revenues realized from The Byron exceeded original projections by an astonishing 65 percent.
Something to keep in mind going into the current budget cycle. The budget is based on assumptions and projections developed by professional city staff. The budget models developed by staff have historically proven to be conservative versus actual numbers. As they should be. The alternative mystery meat math, particularly that proposed by perennial opposition politicos with an ax to grind against mixed use development, workforce housing, and school kids, has proven to be remarkably inaccurate and unreliable.
The mixed use - city center development strategy is starting to bear fruit. It has brought physical change to our community, some well done and some not so well done. But there can be no serious dispute about the financial benefits realized by the strategy undertaken by a core group of political and business leaders in our community.
If it had not been for the hard fought efforts of people to put in place strong city staff, empower them, and to engage in entrenched local political struggles to move the city down a visionary path of economic and physical re-vitalization ... then all of the polite debate about village atmosphere, GEORGE, step increases, reduced funding for services would not be happening. If the city had not been able to move forward on a plan, if it had remained mired in analysis political paralysis where no one led for fear of offending and we stared transfixed at empty lots on Broad Street while fighting with city staff over projections, then we would in a painfully different place as a community.
Lastly, this is also the frustration with disloyal opposition. Intense debate and critical questioning is desired by all. But if the opposition is always political, never defers to experts, is always fear based, always lacks a cogent strategy ... and then always refuses to acknowledge the successes of the community (or in the case of Snyder refuses to even participate anymore) , then what good is it?
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