Council approves $1.3B budget for FY12-13

By Leslie Collins
Northeast News
April 4, 2012

“We no longer have muscle. We are down to the bone,” Kansas City Council member Russ Johnson said of the city’s budget during the March 29 city council meeting.

City council members approved the $1.3 billion budget, an increase of 4.9 percent over last year’s budget, with a vote of 12-1. Council member John Sharp voted against the budget, voicing his disapproval for slashing the fire department’s budget by $7.6 million.

“It’s a tough budget; it hurts, but it’s a positive budget. We’ve balanced the budget,” Mayor Sly James said. “We put doing the right thing above the easy thing. It would have been very easy to come and give people what they wanted at the expense of others who don’t have a powerful voice.”

As the mayor talked about fire department funding cuts, fire fighters in the audience grumbled and shot back looks of disgust.

Local 42 President Mike Cambiano called the city’s decision “one of the sickest things I’ve seen in Kansas City politics.”

Council member Scott Wagner listed several departments that took funding hits over the years while the fire department remained relatively unscathed.

For Fiscal Year 2007-2008, the police department employed 2,171 people, which dropped down to 2,133 for this fiscal year. Since the year 2000, the city has cut more than 660 non-public safety personnel. The Parks and Recreation Department started out with $56.3 million in FY ’07-’08 and will now work with $42.8 million. In his budget letter, City Manager Troy Schulte noted if voters don’t renew the motor vehicle license fee at its current rate in June or August, the Parks and Recreation Department will need to reduce its budget by another $3.4 million. In comparison, the fire department secured a $97.3 million budget for FY ’07-’08 and this year’s budget includes $129.9 million.

Council member Ed Ford reflected Wagner’s sentiment.

Ford said the fire department is taking a 1.4 percent funding cut compared to last year, but the budget also includes a $4 million increase for salaries and benefits.

“To fund the same fire department (without the $7.6 million cut) would cost us an additional $13 million. We don’t have an additional $13 million because our General Fund budget is flat,” Ford said. “I think any of those (other city) departments would have been pleased if they only escaped with a 1.4 percent budget cut.”

To realize the $7.6 million savings, the fire department will need to eliminate 105 positions or determine other avenues to save. Current plans include encouraging early retirement and providing retirement incentives, as well as changing overtime requirements, among others, Wagner told Northeast News.

However, those plans are pending as negotiations with Local 42 and the city are ongoing.

Other budget highlights:

•$5 million in raises for police department personnel if they join the city’s health care plan

•$50,000 to be used as seed money for the Annie E. Casey Foundation and National League of Cities Grade Level Reading Program to ensure every child in Kansas City is reading at grade level by the third grade

$200,000 to locate, hire and staff a chief innovation officer, who will search for ways to deliver city services at the most efficient and low cost way possible

•Despite the economic downturn, Kansas City will continue to fund its reserve fund and contingency fund. The city’s reserve fund will maintain two month’s worth of city expenditures and the contingency fund will be funded at $4.6 million.

“When you are a city, if you are not socking away money, it catches up to you,” Wagner told Northeast News. “The city, for better or for worse over the years, has taken on a lot of debt for a lot of things. When the credit agencies are actually telling you you need to put money into your reserves, you better do it.”

Not saving back money could jeopardize the city’s bond rating and a downgraded bond rating would mean millions more in interest payments, James said.

•$800,000 for bridge maintenance

•The water fund will receive a budget increase of 12 percent ($5.8 million) and the sewer fund will receive an increase of 17 percent ($19.4 million). The additional revenue will be used to repair and replace the water system and expand the current sewer system in the First and Second Creek watersheds, as well as pay for debt, among other items. In 2011, the city responded to more than 1,700 water main breaks – the largest number in Kansas City’s history, Schulte wrote in his budget letter. He doesn’t expect 2012 to be any better.

•Funding for street preservation will decline by $2 million and street reconstruction will decline by $2.5 million. Parks maintenance funding will also decline by $1 million.

Despite the funding cuts, James defended this year’s upcoming budget, effective May 1.

“This budget represents a good budget for the tax payers of Kansas City,” James said. “We have done the things we believe are right. You don’t have to agree with us, you don’t have to love us for it, but we’ve done what we thought was right.”