Fresh Loaf

The budgetary back-and-forth between Shirley Franklin and the Atlanta City Council took on the feel of a cut-throat, high-stakes poker match this past Friday, with the mayor effectively calling their bet – and raising.

When the Council adopted a $571 million city budget for 2009 at the end of June, it sidestepped a proposed tax increase by tasking Franklin to trim $14.6 million from city expenses – on top of more than $57 million in cuts she’d already undertaken to avoid a projected budget shortfall.

On Friday, the mayor upped the ante, instead slashing $21.6 million – nearly 50 percent more than requested – from the budget, at the cost of a West End fire station, a streetlight maintenance contract, vacant police jobs and 78 city employees, including 34 firefighters. That’s in addition to the more than 400 staffers laid off in May.

Franklin didn’t maintain a good poker face; clearly angry, she blamed the Council for forcing her hand. “Their actions will affect the city for a long time to come,” she said.

Minutes later, Council President Lisa Borders countered that the choices were Franklin’s and would be reviewed – and possibly reversed – by the Council. “To indicate that the Council mandated cuts to police and fire is disingenuous,” she said. “We’re not done yet with these cuts.”

Unfortunately, that isn’t all they’re not done with.

On Monday, a judge ordered that, for now, Atlanta and other municipalities within Fulton County could only collect taxes based on 2007 values for most commercial properties – not the 2008 reassessments, which were about 20 percent higher.

No one at City Hall yet knows the full impact of the ruling, but it could mean city revenue would be tens of millions less than anticipated in coming months. Under the judge’s decision, additional taxes cannot be collected on assessments under appeal until more than half of the 15,000 appeals are resolved by the county, a process that likely will take months.

In fact, Robert Proctor, the attorney challenging the county’s assessments, has filed a new lawsuit challenging the certification of tax officials hearing appeals. If his suit succeeds, the appeals process would grind to a halt, adding more months to the delay in tax collections.

Borders said she hopes to learn the scope of the damage by early next week. She also is waiting to hear from city attorneys on the legality of re-opening the budget process, if that step becomes necessary. When it approved the city budget in June, the Council likewise set the tax rate for the coming year. It’s unknown whether the city can revisit that decision so soon.

Said Borders: “This situation is unprecedented.”

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JEKYLL: The first new development in three decades on the island, a Hampton Inn, breaks ground Monday.

AERO HEADS: Jacoby Development’s large-scale “aerotropolis” redevelopment of the Hapeville Ford plant could be the southside city’s big break, but commercial real-estate experts say it’s also a big risk.

REVIVAL: State gives $10,000 to proposed new Allman Brothers museum in Macon.

CEASAR MITCHELL: Running for mayor.

TRIALS OF JOB: Mayor Franklin announces she’ll cut another 165 jobs to deal with the budget shortfall.

THE LONG RUN: USA Today profiles the Braves’ baffling inability to win one-run games.

CLASSICAL GAS: Norcross gas station took part in a $1.99/gallon marketing gimmick that had a line of cars waiting 30 minutes or more to fill up.

NICHOLS TRIAL: Judge says it needs to be moved.

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“The Council had the authority to do this but it is an unwise business decision and represents one of the worst public policy decisions I have seen in my 20 year professional career,”

-Atlanta Mayor Shirley Franklin, on the City Council’s decision today to not to raise property taxes to offset the city’s budget shortfall.

I wonder where her own staff’s chronic mismanagement of the city’s budget office ranks on Franklin’s policy poop list.

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Mayor Shirley Franklin is none-too-pleased with the city council’s adopted budget that actually lowers property taxes and cuts an additional 2.5 percent from departments.

In fact, she calls it the worst decision she’s seen in her almost-20 year professional career.

UPDATE: The mayor’s office has release a revised statement that has the correct dollar figures and a mysteriously removed exclamation point. Yet no punctuation has replaced it… scandal!

Original statement follows after the jump. Here’s the revised one:

The Atlanta City Council is now asking the Administration to make an additional $14.6 million in cuts without cutting personnel. As I stated earlier, anyone who believes that the City can cut $14.6 million (the proposed Administration’s budget already included almost $60 million in cuts) without laying off current employees does not understand the operations of city government. It cannot be done, responsibly

This is a risky choice in a bad economy and the people of Atlanta will have to bear the burden of the Council’s decision to not do what is in the best interest of the residents, both short term and long term.

To balance the budget on the backs of employees is irresponsible, when they were offered an alternative of a modest tax increase in an effort to preserve gains in public safety and to maintain core services. The Council had the authority to do this but it is an unwise business decision and represents one of the worst public policy decisions I have seen in my 20 year professional career and it will have negative ramifications for the quality of life for the people of Atlanta.

(more…)

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One of the more bothersome consequences of having a $140 million budget shortfall is the need to cut public services to save money. Which ones, and by how much? One that was proposed – and all but certain – for the chopping block was weekly pick-up of recycling. The program was outsourced to a private company and city solons had decided that reducing the service to every other week was a good way to cut costs.

Well, it seems that new Public Works Commissioner Joe Basista has figured a way out of this looming tragedy. A recent memo to the Council from Public Works explains that the city will save $3 million by un-privatizing curbside recycling (take that free-market champions!) and that city workers will happily continue to pick up cans, bottles and newspapers every week.

Atlanta homeowners had already dodged a bullet when the Council decided against scrapping yard waste pick-up. If you need further info about trash, recycling or yard waste collection, go here.

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To those moaning over a likely tax increase in Atlanta we offer two words: East Point.

Although the town lying just southwest of Atlanta has achieved widespread fame as home to such hip-hop superstars as OutKast and Goodie Mob, that success hasn’t been matched by the local government. For the past decade, East Point has been, hands down, the worst-managed city in the 10-county metro region – and this includes such screwed-up ‘burbs as Lithonia and Snellville.

You’ll recall that, a few years back, East Point’s then-Mayor Patsy Jo Hilliard revealed the city had somehow squandered an $11 million surplus and had a $8 million deficit. That’s a $19 million mistake for a city that only had a $75 million budget. It also was later discovered that the city owed an additional $18 million to Atlanta for water-system improvements and hadn’t paid a $4.5 million power bill. Taxes were jacked up nearly 70 percent to cover the gaps.

Last year, East Point raised its already punishing tax rate by 20 percent, but still ended the year $7 million short. In fact, as the AJC has reported, the city has spent the past 10 years in the red. This year seems to be a replay with yet another projected budget deficit, this time of at least $5 million. The city is now faced with the choice of sending all city workers home or closing three of its five fire stations.

As someone who lived in East Point for three long years a while back, I have to say I’m glad I got out while the getting was good. Sad to say, but that place is fucked.

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The chance that Atlanta residents can avoid a property tax increase next year seems to diminish with every new conversation we have with a Council member.

You’ll recall that Mayor Shirley Franklin called for a tax hike about a month ago in order to erase the last $40 million of a projected $140 million shortfall in the 2009 budget. The suggestion didn’t go over well with Council members, who vowed to find new revenue sources and/or other budget items to cut, in order to sidestep higher taxes.

A couple of weeks back, the Franklin administration announced that, because of higher-than-expected tax collections, the tax increase could be much smaller than first proposed. That may have softened the will of some Council members, although publicly they continued to push for more cuts.

Then, last week, the Council learned that its two leading prospects for generating new revenues have fallen through. The first was refinancing employee pensions to stretch out the payment schedule, a move that would free up $20 million in the coming year. The result, however, would be huge balloon payments in future years; the Council dismissed that possibility as irresponsible. Another $10 million or so might be raised through selling tax delinquencies, but the city would have to coordinate that with Fulton County, which has so far been unreceptive.

The Council is still looking at cutting some vacant staff positions, but nearly any other potential action would merely be nickel-and-diming a $40 million hole in the budget. Reading between the lines of what Council members are saying, it sure seems as if they privately believe there’s no way around a tax increase.

“The question is, are you willing to lay off police and fire personnel or absorb a tax increase?” says Council President Lisa Borders, who nonetheless says: “If we can avoid raising taxes, we will.”

Council Member Anne Fauver now expresses some regret at having said at a public meeting that the city would raise taxes “over my dead body.”

“We’ve found some things to cut, but I can’t say it’s $40 million worth,” Fauver says.

And Howard Shook, who chairs the Council’s Finance Committee, describes the quandary this way: “Which is worse – your constituents blaming you for a modest tax increase or them blaming you for the unprecedented failure to approve a balanced budget, and all the catastrophic financial fallout that would have?”

If the city were to miss its June 30 deadline to adopt a new budget, Shook says, Atlanta would officially be in default of tens of millions of dollars in municipal bonds, a move that would send our bond ratings crashing down.

Even though the Franklin administration has estimated that it cost the owner of a $200,000 house an additional $24 a year, Shook still says he hopes a tax increase can be avoided.

The Council has only a few more days to make it happen. Public meetings are scheduled for Wednesday and Thursday of this week, and Monday and Wednesday of next week before a final vote next Friday.

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MARTA’s current budget deficit: $43 million

Number of positions MARTA plans to eliminate because of deficit: 180

Number of these 180 positions that are currently vacant: 130

Number of future MARTA newly created station-agent positions being offered to newly laid-off MARTA employees: 50

Amount by which MARTA’s revenue from local sales taxes was below expectations during first-quarter of 2008: $6.9 million

Amount MARTA spent on fuel last year: $13.4 million

Amount MARTA expects to spend on fuel this year: $17.6 million

Number of trips MARTA passengers took in April 2007: 11,999,867

Number of trips MARTA passengers took in April 2008: 12,800,276

Amount MARTA contributes to Atlanta’s gross regional product: $476 million

Amount state contributed this year to MARTA needs: 0

Source: Atlanta Journal-Constitution, MARTA, GeorgiaGasPrices.com, Mass Transit Magazine, Creative Loafing

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Janice Davis, chief financial officer for the Franklin administration, handed in a letter of resignation this morning. But, allaying the worst fears of some Atlanta officials, she won’t be departing until after the contentious city budget is put to rest.

“The budget is about to undergo open-heart surgery and she’s the only one in the room with a medical degree,” says Councilman Howard Shook, who received Davis’ two-sentence resignation by e-mail a short while ago.

A few council members have grumbled that Davis should be fired for presiding over a budget process that produced a $60 million shortfall in the current-year budget and a projected $140 million shortfall in the upcoming 2009 budget. But Shook, who chairs the Council Finance Committee, and others have argued that doing away with Davis would leave the city without a finance chief when it needs one most.

Several council members have privately speculated that Davis would leave the city’s employ shortly after the adoption of next year’s budget – and it now appears that will be the case.

According to Davis’ brief letter, she will stay on the job until July 9, then leave to accept a position in Texas. A Franklin administration spokesperson had no comment.

As of now, the Council is preparing to hold a series of budget discussions to tweak a Franklin budget proposal in an attempt to erase a proposed tax increase. The Council is scheduled to approve the final budget at a special meeting June 27.

(Photo by Joeff Davis)

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FEE FOR ALL: Atlanta City Councilman Jim Maddox proposes taxing $1 for tickets to pro sporting events and major concerts in the city to help soften the looming $140 million budget shortfall.

14TH STREET BRIDGE: Dead to us.

GET OUT OF MY CAR: Between March 2007 and March 2008, American driving dropped at the steepest rate since record keeping began in 1942.

ABATED BREATH: Beginning next year, asthma sufferers will have to switch to the more expensive CFC-free inhalers for environmental reasons, good for ozone but a blow to Atlantans who already live in an asthma-unfriendly city.

YOU GOT CONSERVED: As utilities start raising rates to make up for reduced usage, the dark side of conservation is rearing its head across the Southeast.

ONE FLU OVER THE CUCKOO’S NEST: Study released Monday says strains of bird flu are getting closer to conditions that could lead to a human pandemic.

GETTING BROWSY: The “browser wars” of the mid-’90s are heating back up, as Mozilla readies Firefox 3.0 for release in June and Microsoft’s Internet Explorer 8 is due later this year.

FRIGHTENING IN A BOTTLE: Orlando man sells bottles that he claims have ghosts in them.

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The city’s Department of Planning and Community Development — which oversees the bureaus of buildings, planning, code compliance and housing in Atlanta — was ordered to lay off 38 workers on Thursday per Mayor Shirley Franklin’s suggestions to alleviate the city’s budget shortfall. The department also eliminated 12 vacant positions, a spokesperson says.

It’s still too early to determine how the lay offs and budget crunch will affect projects, the spokesperson says. The Connect Atlanta Plan, the city’s first-ever comprehensive transportation plan, is being designed by consultants, not city employees, and will not be affected.

Still waiting to get back what duties were eliminated and whether it was an across-the-board cut or focused on lower-level employees.

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Per Mayor Shirley Franklin’s suggestions to the council, 11 recreation centers in the city are to close down for repairs. No word on the specific centers yet. Dianne Harnell Cohen, director of the city’s Department of Parks, Recreation and Cultural Affairs, says the centers were planned to be closed before the $140-million shortfall:

“We will be renovating 11 recreation centers for the Opportunity Bond, which must be spent during the 2009 budget. The renovations were planned before the need for budget cuts was determined. We will have some abbreviated hours at the recreation centers, tennis centers and natatoriums. We will have 19 Camp Best Friends sites this summer. All youth athletic activity will continue in place.”

Two rec centers will be shutting down permanently, as well. Again, from Director Cohen:

“The Cleveland Avenue recreation facility, owned by Fulton County, was used only in the summer. The facility is very old and is no longer functional. There are no plans for renovation because one of our best facilities – a class 4 facility Rosel Fann with full gymnasium and natatorium is less than a mile away.

The Arthur Langford recreation facility has been under discussion for a long time because the YMCA built its new mega center there a year ago. We have been working with the community and will continue to in order to integrate programming at the center with the YMCA so the entire community and the building can be well served.”

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Just came in via e-mail. City officials plan to lay off 125 workers in a first round of restructuring to chip away at the estimated $140 million deficit. Mayor Shirley Franklin has suggested several cuts and said that 788 positions — of which 441 are currently filled — will eventually be eliminated. Plans include raising taxes as well.

Click here to view Franklin’s letter to the city council that outlines her plan. Included in her proposal:

• Reduction of 135 personnel in support departments

• Reduce the number of operating municipal courts from nine to seven; consolidate the Office of the Solicitor with the Department of Law

• Eliminate 59 positions in Solid Waste Services and shift to bi-weekly collections of recyclables and yard trimmings

• Close 11 recreational centers for repairs and permanently close two recreational centers

• Eliminate city shuttle service

• Reduce the city’s contribution to health care plans from 77 percent to 70 percent

CL staff writer Scott Henry’s been at City Hall for most of yesterday and today and will provide more analysis.

In the meantime, I’m combing through the details to see if she uses any of the chatroom parlance with the council which she showed off when she made her most recent appearance here on Fresh Loaf.

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BUDGET CRISIS: Atlanta considers privatizing some city services to deal with the budget shortfall.

ZEBRA OWNER: Wants to press charges against pranksters, argues stunt was dangerous, unlike “taking a goat over there,” which would apparently be a fine thing to do.

CLAYTON: School board hires Thompson as corrective superintendent, board chairman and attorney quit.

BRIAN NICHOLS TRIAL: Judge Bodiford won’t step down despite defense’s discovery of a 2005 Marietta Daily Journal article in which Bodiford was quoted as saying he was friends with the judge who was killed. He’s asking another judge to rule on the issue.

STUDENT LOANS: Getting scarcer.

UNWAFFLE BEHAVIOR: Police mace, arrest Truett Cathy’s grandson after he allegedly went on a nude rampage in the bathroom of the Northside Drive Waffle House.

STRIP CLUB ARSON: Army medic who was working as a strip club’s security guard pleads guilty to arson in the burning of a competing club, Club Onyx, in January 2007.

BANKS BANK ROBBED: Man sought for robbing a bank at Banks Crossing in Banks County Thursday.

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Current projected revenue shortfall in Atlanta: $65 million

Amount by which Atlanta exceeded its budget during fiscal year that ended June 2007: $90 million

Amount city overestimated its year-to-year budget surplus since 2003: $241 million

Estimated revenue shortfall city predicts it will face next year: $120 million

Amount of city’s budget shortfall when Mayor Franklin took office in 2002: $82 million

Percent property tax hike imposed in 2002 to cover city’s budget shortfall: 51

Percent by which the city has rolled back property taxes since then: 22

Percent by which all 15 city departments were recently asked to cut their budgets: 25

Sources: Atlanta Journal-Constitution, City of Atlanta Dept. of Finance

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SONNY DISPOSITION: Gov. Perdue is “very concerned” that legislators want to let Georgia communities vote on allowing Sunday alcohol sales: “The people of Georgia send us here to make decisions.” Even if the people of Georgia disagree with those decisions.

DELAY OF GAME: Atlanta-based startup All-American Football League postpones inaugural season to 2009.

NORREESE HAYNES: Battling various outrages.

GETTING OFF ON THE WRONG FOOT: Foot licker causes ordeal in Cordele.

MOUSEHUNT: Flight to Atlanta grounded for hours due to mouse on board.

CITY BUDGET: Now the shortfall is $65 million, according to city CFO; layoffs “likely.”

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Government operating budgets are, by law, public information.

Decatur posts its budget online. So does the state. Even the $3 zillion federal budget is available online.

The city of Atlanta’s budget is not online. Worse yet, the city will not show it to me.

On Feb. 21, I called several people at the Department of Finance. No one with a copy of the budget picked up the phone or returned my calls.

Last week, I complained to Mayor Franklin’s office, which prompted a phone call from Margaret Crenshaw, director of the office of administrative and legislative services in the finance department.

Crenshaw told me I’d have to pay a per-page fee, even for a digital copy of the budget. She also asked me to submit a written Open Records Request.

I sent such a request to Crenshaw on Feb. 26. She has not yet responded.

According to the Georgia Open Records Act, Crenshaw’s office had three days to honor my request, or cite a provision under state law that would prevent her office producing the public documents I requested.

Whether it’s the result of incompetence, malice, or a combination of both, the city’s failure to share public information is obnoxious. The city is facing a budget crisis brought on, at least in part, by mismanagement. With severe budget cuts on the way, the public has an interest in knowing how the city is spending public money.

Is the city hiding the budget from everyone? Is it something I said? Are they waiting for someone from the Geek Squad to show up and teach them how to e-mail PDFs?

For now, all I can do is complain. Sadly, the Georgia Open Records Act is toothless. The fine for hiding public records is a measly $100.

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This writer briefly considered writing an Add It Up about the city of Atlanta’s operating budget today.

Then he realized the city of Atlanta doesn’t seem to have a copy of its budget on the website where it is supposed to be.

At a time when the city is facing huge budget cuts and accusations of gross mismanagement, the city’s failure to make the budget freely available to the public is unfortunate and disturbing.

Calls made by this writer to the city’s budget office have not yet been returned. Rest assured this writer will continue to refer to himself in the third person until he gets an answer.

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I was in fine spirits when I woke up this morning.

Then I noticed that the most popular story on AJC.com is still “Ashley Judd’s attire raises eyebrows in NASCAR garage.” It’s been the most popular story since Sunday.

Meanwhile, Mayor Franklin’s mismanagement of the city’s budget (the most important local news story since DroughtWatch’07), can only be found deep within the site’s Metro section.

Our city government is lousy. But no lousier than we deserve.

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Holding a midmorning press conference today to discuss the mega-buck budget shortfall the city is facing, Mayor Shirley Franklin and finance chief Janice Davis gave a sneak preview of more bad times to come.

Even beyond the current fiscal crunch, they said, the souring economy will likely mean more municipal belt-tightening in the upcoming ‘09 budget, which actually begins in July.

For example, last year the city adopted a $650 million budget for ‘08. With projected revenues trending ever downward, Atlanta could be looking at a lean-as-hell $500 million budget for next year, Davis said. The result could be far-reaching cuts in city services and probably in city staff, since about 75 percent of the budget is wrapped up in personnel costs.

But the morning’s big eyebrow-raiser was Davis’ assertion that the amount of the anticipated shortfall remains a mystery.

“Right now, I don’t know how large it’s going to be,” she said, a statement that would seem to contradict the mayor’s claim from just two weeks ago that the figure is expected to be about $70 million.

When CL pointed out the apparent inconsistency to Franklin, she said the $70 million figure is an early estimate – but the city is still standing by it. We’ll see.

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On Wednesday the Atlanta City Council Finance Committee briefly discussed a proposal by Councilman Lamar Willis that … well, let’s just say it ain’t gonna make Shirley very happy.

Like most council members, Willis is fuming over the mayor’s recent announcement that the city is facing a $70 million budget shortfall because of unanticipated expenses and accounting mistakes. Therefore, Willis wants to rescind a number of pay-grade increases for city executives approved in November.

The increases boosted the salary ranges for top management positions, from chief of staff (max earnings rose from $208K to $237K) to chief financial officer (from $216K to $271K) to the budget chief (from $132K to $170K).

Councilman Howard Shook, who chairs Finance, says the increases were enacted last fall to make the city more competitive in attracting top-flight management talent. Besides, he says, since the pay-grade adjustments didn’t translate into immediate raises for the affected employees, the total cost of the measure has been estimated at about $10,000 so far.

“This is not how you overcome a $70 million deficit,” Shook says.

Perhaps, says Willis, but “it sends a message to the executives who possibly put us in this situation.”

The proposal has support from fellow council members Natalyn Archibong, C.T. Martin, Felicia Moore and Ivory Young. Still, Willis agreed to hold it until the next meeting to allow time to see what the actual cost of the pay-grade increases has been.

Who will figure up that figure? The city finance department, of course.

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