Turner’s budget unanimously OK’d by council
$2.3B plan cuts spending by $82M but largely relies on one-time fixes
Mayor Sylvester Turner achieves his goal of securing unanimous passage of his first budget after an unusually brief and amicable council discussion.
Houston Mayor Sylvester Turner achieved his goal of securing unanimous passage of his first budget Wednesday, a month ahead of the typical schedule and after an unusually brief and amicable council discussion.
The $2.3 billion general fund budget, which pays for most basic city services with revenues from taxes and fees, spends $82 million less than the current budget, only the second budget cut for Houston in two decades. That is in spite of the city facing an additional $27 million in mandated employee raises and $29 million more in rising pension payments in the fiscal year that starts July 1.
Turner has acknowledged balancing the books for another year does not correct Houston’s ongoing budget problems, driven by rising pension and debt costs, and, more recently, voter-imposed limits on property tax collections and slumping sales taxes undercut by the weak oil market. Ratings agencies Moody’s and S&P cited all of those factors in lowering the city’s credit rating by one notch in March.
The mayor repeatedly had urged council members to grant him unanimous and early passage of the budget to signal that Houston’s leaders are aware of its fiscal issues. He was downright jubilant Wednesday after getting his wish, even joking that he might run a lap around City Hall after the postmeeting news conference.
“We sent a very strong message to all the credit ratings agencies that we are getting our financial house in order, and we’ve set ourselves up very well to deal with the other issues that are on the horizon,” said Turner, who reiterated his goal of securing a deal to reform the city’s costly pensions by November. To council members, he said, “I want to thank you for the trust you’ve placed in me.”
The council also approved budgets totaling $2.8 billion for the city’s enterprise funds, such as the utility and airport systems, which are supported by user fees rather than taxes.
Councilman Jack Christie, who chairs the council’s budget committee, praised the spending plans.
“We now have a lean and mean budget,” he said. “He did it without burning bridges or making people too mad, and he did it without hardly any layoffs.”
As Councilman Michael Kubosh exited the council table after the meeting, he grinned and said, “Wow, I voted for the budget.” Being the confrontational contrarian, the secondterm councilman has been
known to remark, is “in my DNA.”
Kubosh said his support came in part because of the passage of his budget amendment, which will spend $110,000 to expand an effort to pull submerged cars from bayous, and in part by Turner’s consistent outreach.
“I’ve already met with Mayor Turner more times in 150 days than I met with (former) Mayor (Annise) Parker in two years,” Kubosh said. “He’s so willing to talk to us.”
‘Consensus building’
In closing a $160 million gap between revenues and expenses, the general fund budget cuts 54 vacant positions and includes roughly 40 layoffs. It pulls $10 million from reserves, makes $56 million in permanent changes — mainly cuts within departments — and relies on $94 million in one-time fixes, mostly refinancing city debt, selling public land and deferring payments.
Controller Chris Brown, the city’s elected financial watchdog, praised Turner’s effort but also noted the need to pull expenses in line with revenues without relying on one-time fixes in the future.
“That was needed to frame things for, hopefully, the future with pension reform, but we need to focus on structurally balancing the budget going forward,” Brown said. “But overall, I think the mayor did a fantastic job. I’m hopeful we can carry this kind of momentum and consensusbuilding problem-solving toward our long-term structural problems.”
Members keep funds
Council members submitted 23 amendments to the budget, about a third of the usual total. All but 11 were withdrawn, and only two, other than Kubosh’s, carried specific costs.
Councilman Greg Travis’ attempt to cut an additional 1.5 percent from the budget failed, with only his vote in support. Councilman Jerry Davis’ proposal to partially restore the 11 district council members’ cherished service funds passed unanimously.
Turner’s proposal had cut that two-year-old program — which gives district members $1 million to spend in their areas — to $250,000 per district. The members will keep those general fund dollars but, thanks to Davis’ amendment, each will get an additional $500,000 from cash the city receives from the Metropolitan Transit Authority for infrastructure repairs.
The combined $5.5 million is part of nearly $62 million in so-called “general mobility” payments the city expects to receive from the transit agency in the coming fiscal year. That figure does not include another roughly $60 million that Metro will contribute to specific capital projects in the city.
ReBuild remains
The general mobility dollars are part of the city’s ReBuild Houston program for repairing streets and drainage, and they typically go to pay employees to fill potholes, maintain traffic signals, repair bridges and resurface streets.
Tapping Metro funds will not change the repairs that are made, Turner said, but will lock in the $8.25 million in general fund savings he had sought. The move will give council a voice in which jobs get priority, he said, for such efforts as sidewalk repairs and speed bumps.
“It’s work that needs to be done in the communities, in the neighborhoods, in the districts,” he said. “They’re all street-related anyway. There’s a high demand for these street calming devices, or for sidewalk repairs, so those are things they want, and the district council members are in a better position to determine what’s important for their districts.” mike.morris@chron.com twitter.com/mmorris011