Wednesday, I reported on the Richardson City Council's review of the 2023-2024 Second Quarter Financial Report ("Council Recap: The Case of the Missing Sales Tax"). I included the comments from most of the City Council. Thursday, I reported on what the Mayor said (or didn't say) ("Council Recap: Where was the Mayor?"). Today, there's one more person to hear from whose comments deserve scrutiny — City Manager Don Magner.
Again, the big news was the fact that there was a serious hole in he budget due to the fact that, with seven months of remittance, sales tax is $1.84 million below the budget target.
This all started back in 2023 when Councilmember Ken Hutchenrider, upon hearing City Manager Don Magner's budget proposal, "pushed" for a 6% raise in the salaries of City employees instead of the 5% Magner had proposed.
The first curious thing was how Magner immediately said, "if that's the consensus, I can take that and really, really move that proposition forward." He hadn't waited for a consensus to be voiced. Hutchenrider made his request and no one else even had an opportunity to speak to it before Magner said he'd "take that challenge." Curious.
Why hadn't Hutchenrider done the conservative thing and suggest waiting until midyear to decide whether the City could add another 1% raise on top of the 5%? Perhaps because he didn't think the City could do it that way. He asserted, "Compare for a moment the public and the private sector. Public sector like we're in as a city, we have one bite at the apple, so to speak. Private sector, if we make a modification, we can come back a second time, some cases a third time and make a modification."
Hutchenrider was wrong. The curious thing was that Magner didn't correct him. The City can do midyear raises if it wants. Maybe if Magner had corrected Hutchenrider then and there, Hutchenrider would have withdrawn his request for immediate 6% raises and the City would have been spared the future budget hole we now face.
Later, Mayor Dubey asked exactly what Hutchenrider assumed wasn't possible: whether the additional money for a 1% raise could be saved for midyear raises. "I know we have to set a budget, but if we set it with [an additional 1%] there and maybe be merit based at a later date, is there any way to do that?"
It wasn't that Mayor Dubey was wanting to be conservative with City spending either. He wasn't doing employees a favor (remember, he was asking to go with 5% raises until mid-year). No, he appeared to just want to game the budget calendar to one up other cities who might wait to see Richardson's budget before setting their own employee raises. Gamesmanship.
Magner explained, "Mayor, you're exactly right. There are mid-year adjustments. You know, sometimes a community will be seeing stronger revenues in other areas than they budgeted for and then they might decide to do a mid-year adjustment using some of those revenues." So, why tell the Mayor this and not tell Hutchenrider? Dunno, but it's curious.
The end result? The City Council was allowed to go somewhere they were probably inclined to go anywhere, approving a budget that relied on volatile sales tax revenue to pay for an immediate 6% salary increase that instead could have been divided into a 5% raise at the beginning of the year and an additional 1% mid-year raise conditional on revenues supporting it later. And the Council did this while saying things about how they appreciated that Richardson always does conservative budgeting. Magner didn't correct the Councilmembers' belief in that regard. He let them believe the myth. That's the part of all this that was not curious.
"Gratitude expressed,
For a myth of prudent budgets
Built on sales tax sand."
—h/t ChatGPT
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