The underlying theme throughout the first three years of Mayor Park Cities’ term, the one thing that he has insisted on as he pushed for the Trinity toll road, campaigned for the convention center hotel, and even tried to take over the DISD, has been that Dallas can only continue to be great if we have what he always refers to as a “favorable business climate”.
As the council begins its August budget deliberations, here’s something to ponder: Under Leppert, the self-proclaimed fiscal conservative and pro-business mayor, the percentage of the city’s total operating budget that goes for interest payments on debt has increased from 10.7 percent in the 2006-07 fiscal year to 14.4 percent in 2009-10. In other words, we have gone from paying principle and interest on $1.4 billion in debt in 2006-07 to almost $2 billion four years later. That’s a 43 percent increase. Inflation, by comparison, has been about 12 percent over that period.
Ain’t much fiscally conservative or pro-business about that, is there?
I was stunned to discover this. I may not like most of what Leppert has done, but I did buy into the image that he has so carefully crafted. Turns out there is as little to his image as there is to his programs. (Want to double check my math? Go to the city’s website, and then click on government, then chief financial officer, then the budget year, and then debt service.)
To be fair, Dallas’ debt situation hasn’t reached New York City proportions yet — the Big Apple nearly went bankrupt in the 1970s from financing its day-to-day operations with the municipal equivalent of credit cards. But our situation is not good, and it doesn’t matter how many times Leppert or city manager Mary Suhm brag about Dallas’ “exceptionally high” bond ratings. Which, oddly enough and little reported, have declined from AAA/Aaa in 2002 to AA+/Aa1 today.
And the ratings are not going to stay even that high if we keep throwing money hand over fist. Which we’ve been doing. The city was carrying just $762 million in debt in the 2002-03 fiscal year, and it accounted for only 9 percent of the total operating budget. Which means we’ve almost tripled the amount of debt we’re dealing with, and its percentage of the city budget has gone up by two-thirds.
And do you know what’s even more depressing? That debt measured as percentage of the budget went up just 1 percent during Laura Miller’s five-plus years as mayor. Yes, that Laura Miller. We didn’t know we had it so good, did we?
There are two problems with debt. The first, of course, is that if we have too much of it, we can’t pay it, and then we are in New York City territory. The more immediate problem is that so much debt limits what we can do to fix the budget — which desperately needs fixing. City officials aren’t working with 100 percent of the budget as they try to figure out a way to make ends meet for 2010-11. They’re only working with 86 percent of it, since they have to pay the 14 percent that goes to debt service — or else.
So the cops who get furloughed and the rec centers that get closed and the potholes that don’t get filled? Blame the recession, which cut tax revenue. But also blame Leppert’s tax and spend approach to city government. Even at this late date, as the budget crashes around him, he was quoted as saying he wants to borrow money to pay for pothole repairs.
I took a lot of heat last year when I supported a property tax hike to preserve some essential city services. But don’t worry. I’ve seen the error of my ways. Let’s cut the budget and get through this thing the best we can, and start over in 2011 or 2012 when the economy improves.
With, hopefully, a more enlightened mayor and city council.
