NEWS
WHAT ABOUT THOSE
MILLIONS IN CITY FUNDS?
Some city leaders are asking voters to approve a city
service fee on the ballot in May, but others are saying “not so
fast” — the sacrifi cial services on the chopping block don’t
have to be the fi rst cut.
After the city manager announced a projected $6 million
shortfall in general fund revenue for fi scal year 2014 (the
year beginning this July 1), the City Council voted to refer
to the ballot a monthly city services fee of up to $10 per
housing unit and $30 for businesses, with an undetermined
form of assistance for low-income residents. Council and
staff also put forth a list of services to be cut should the fee
fail at the ballot box.
Former city councilor Bonny Bettman McCornack
is now co-director of Citizens for Truth, Justice, and the
American Way (CiTJAW), a political action committee of
liberals and conservatives who oppose the proposed fee. As
a city councilor, Bettman McCornack was part of the city’s
Budget Committee, which is composed of eight appointed
citizens and the City Council.
“Almost every year, the assumptions and the proposed
budget underestimate the amount of revenue,” Bettman
McCornack says. As a result, City Council usually meets
again during the fi scal year to create a supplemental budget
to disperse the funds, which Bettman McCornack says is
“very often millions and millions of dollars.” For example,
Bettman McCornack says that the FY2012 budget predicted
an ending fund balance of $34 million, but the true ending
fund balance was $43 million.
Sue Cutsogeorge, Eugene’s fi nance director, says
sometimes the listed dollar amount of the general fund’s total
resources looks larger because of other factors. (Eugene’s
supplemental budgets for the past several years list total
resources that hovered around $159 million from FY2008-10,
then jumped to the $170 million neighborhood in FY2011-
13.) For example, she says carryover balance, the amount of
one-time-use funds from projects started in one fi scal year
and fi nished in another, can be included in the second year’s
general fund total and make it look artifi cially large.
Without factors such as carryover balance, Cutsogeorge
says that revenues have increased an average of 1.1 percent
per year from FY2008 through FY2013, slower than costs
of health care and comparison points in the Consumer Price
Index.
“It’s a shell game,” Bettman
In addition, Cutsogeorge
McCornack says. Instead of
says that the city has been hard
looking at the general fund and
at work paying back into the
not seeing money for the Sheldon
reserve for revenue shortfall
Pool or library hours, she says the
(RRSF), a fund that some liken
BONNY BETTMAN MCCORNACK
council should be looking at ways
to the general fund’s savings
to stop moving money out of the
account. She says that the city
general fund by cutting expenses
received praise in Moody’s
like the $275,000 sent from the general fund to Urban
Investor Services’ latest report on Eugene, and a high
Renewal for the Downtown Loan Program or delaying the
“Aa1” bond rating, in part for maintaining “sound reserve
$1 million moved to the facilities services fund to save for the
levels.”
rebuilding of City Hall.
“City Manager Jon Ruiz has also emphasized the need
The institutional problem, Bettman McCornack says, is
to maintain an adequate reserve level, and to ensure that
that expenditures like essential services don’t have to compete
those reserves (one-time funds) are not used to pay for
with expenditures that occur outside the budget process, like
ongoing services,” Cutsogeorge says. “We consider the
MUTPE tax breaks and other special expenditures. “Those
use of reserves to patch over some ‘fi nancial potholes’
expenditures happen outside the budget process while
from time to time, in instances where use of reserves can
they’re moving all this money out of the general fund,” she
smooth over temporary shortfalls. We did that in FY2013,
says. “This happens year after year to various degrees.”
for instance (in combination with signifi cant budget
Read more about the cases for and against the fee at
reductions), in order to allow for more time to develop a
votenocityfee.org and wkly.ws/1fv. — Shannon Finnell
sustainable solution to the budget gap.”
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March 21 , 2013 • eugeneweekly.com
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