New budget is just a short-term fix

The Memphis City Council, during a marathon session Tuesday, passed a budget and a tax rate that get the Tennessee comptroller off the city’s back for a year, but do nothing to deal long-term with the debt and revenue crisis facing the city.

The council meeting, which began at 3:30 p.m. Tuesday and ran well past midnight Wednesday morning, also revealed that some council members are unwilling to acknowledge or are blind to the city’s floundering financial situation.

The 13 council members, after many twists, turns and compromises, approved a property tax rate of $3.40, up from $3.11. Most of that increase, 25 cents, was necessary to bring in the same amount of revenue because of property value decreases.

Council member Harold Collins, with an important assist from council member Bill Boyd, was able to find the compromise on the operating budget that finally passed. His plan reduced the 100 layoffs proposed by Mayor A C Wharton and others to 50, restored 70 vacant police and fire positions and preserved the city’s weights and measures department. The budget cut 2.5 percent from the Police Department, although police Director Toney Armstrong said he could absorb the cuts without layoffs.

The budget also restored the 4.6 percent pay cut given to city employees in 2011, added money to the reserve fund, and gave money for community centers, the library system, code enforcement and Memphis Area Transit Authority. It also put in funds to deal with more than $4.2 million in higher health care premiums expected this year.

Here is where reality failed. Some council members could not resist trying to add pet projects to the budget. We realize that politics dictate that they have to wave the flag for their districts’ constituents. To do so at this juncture of the city’s wobbly financial status — unless it addressed a critical public safety issue — was irresponsible.

Fully restoring the pay cut had been a major distraction in the council’s budget deliberations and Wharton’s budget presentation. On top of that, state Comptroller Justin Wilson sternly warned the mayor and council they needed to get the city’s financial house in order.

Wilson said the city’s unsustainable debt load and an inadequate reserve fund were major problems, exacerbated by a lack of incoming revenues, devaluation of property values and a generous tax abatement program. The budget the council cobbled together Tuesday is basically a one-year fix for those issues.

The city will be facing the same challenges next year. With the pay restoration issue out of the way and a clear picture from the comptroller of what needs to be done, the council, as a body, should be able to work with the mayor to put the city’s long-term financial stability on a positive track — if some council members can bring themselves to face reality.