Growing deficits make mayor fret

Other Largo commissioners point to the city's large cash reserve and say he's jumping the gun.

By MICHAEL SANDLER, Times Staff Writer
© St. Petersburg Times
published February 10, 2002

LARGO -- Mayor Bob Jackson thinks Largo is spending too much money.

For the past three years, Jackson has watched expenditures in the general operating budget grow millions of dollars beyond the tax revenue taken in.

This year, the city expects to spend $2.7-million more on expenses -- approved by the current City Commission -- than it will receive in taxes, according to the Fiscal Year 2002 Annual Budget.

Where has Largo made up the difference? Jackson said the commission has favored chipping away at the city's reserves in lieu of raising property taxes.

Much of the additional spending is needed so Largo can offer competitive salaries to union employees such as police and firefighters, city officials say. But Jackson fears freewheeling with cash reserves can be costly. He wants commissioners to either show some restraint, or come forward and ask the people to pay more.

"My idea is to let the people know you are spending more money than you are taking in, and you can't do that forever," said Jackson of plans to spend $41.4-million this year while taking in $38.7-million.

"We are giving the people what they are asking for. They need to be aware it is costing them money. There is no free lunch."

The city spent nearly $2.5-million more than it took in in 2001 and $400,000 more than in 2000, according to this year's budget.

Kim Adams, director of management services, said that despite the pattern, the city's fund balance is slightly up this year thanks to other sources of revenue. That's $7.4-million, more than 15 percent of the general fund budget.

"A benchmark for a lot of cities is no less than 5 or 10 percent," he said.

Commissioner Pat Burke said that Largo is one of the most financially healthy cities in the county.

"The mayor, he is a pessimist -- always has been, always will be -- when it comes to numbers," she said. "You will always have years where expenses are more than revenues."

She said his stated concern "only worries the citizens of the city. It is so far removed from what could happen."

Adams said his office is finishing the city's annual audit. Once it is completed, he plans to present the financial picture to the City Commission in early March.

One thing the city has had to devote more money to is public safety.

City Manager Steve Stanton said offering competitive salaries has largely contributed to the increases. The police budget has gone from $9.6-million in 1998 to $11.7-million this year, while fire department spending has increased from $7.7-million to $9.4-million in the same stretch.

Stanton said his staff has managed to balance the budget the past three years with creative thinking. The department added 17 new officers in 1999 using federal grants.

Those grants ended last year, accounting for nearly $1-million that had to come from the city budget. For now, the city has relied on the reserves for that amount.

"You can't continue doing that forever," said Stanton. "At some point, you have to make sure the revenues equal expenditures."

Jackson recommends setting strict priorities and then pulling tighter on purse strings for extras.

A good example, he said, was the commission's recent 6-1 decision that authorized spending $97,000 in 2003 for major improvements to the city's clock tower and fountain at Largo Central Park, instead of spending $25,000 budgeted for minor repairs.

Commissioner Harriet Crozier defended the vote. She said the fountain's original construction was shoddy. Doing it properly once and for all will preclude future costly repairs.

"If the $97,000 is what we really want, then we budget for it (next year) and apply the $25,000," said Crozier. "Its like building the road and knowing you are going to have to tear it up and do the refinements. Why not wait and do it when you can afford it?"

Nonetheless, Crozier said, Jackson is smart to eyeball expenditures.

"Obviously, somewhere along the line we messed up," Crozier said of the discrepancy between income and expenses. "I want to keep the healthy reserves."

Commissioner Pat Gerard noted that the city has other sources of revenue, such as local sales taxes. Adams and Stanton also noted the city's added revenues from new properties joining the city through annexation.

"I don't know that I share the mayor's concern that we won't be able to come in with a balanced budget this year without increasing taxes," said Gerard.

The City Commission generally approves the budget in August, so she said there is time.

"I'd like to get some more information before we start talking about raising taxes," said Gerard. "I think it's a bit premature."

-- Michael Sandler can be reached at 445-4174 or sandler@sptimes.com

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