There's a lot of talk on the web about the pension fund and whether voters would support an increase in sales tax to fund it.
I attended the media budget briefing, what, a couple of weeks ago? Last week? When was that thing? Anyway, regardless of when it was, here is my understanding of the key points I think the city is trying to make.
For expediency, here's what Mike Brothers of the City wrote, in part, in an email to me this morning:
"The law was passed at the state level last year, so the best way to put it is that we’re coming up on the end of the first year and the start of the second."
The "law" Brothers is referring to is a state law that requires Springfield (and other cities) to meet an actuarial recommendation amount for funding the pension plan one year out of five and the clock started ticking last year. The City wants to meet that actuarial recommendation next year because every year the actuarial recommendation will continue to increase by big bucks.
Naturally, if the City pays the $5.2 next year they won't have to pay as much as they would have to pay the year after that or the year after that or the year after that. That is one of the reasons why the City wants to pay it in the next budget year. The other reason is, if they don't get it done sometime in the five year period the state can garnish the city's sales tax revenue and make sure it gets done. The city doesn't want the state to do that, the city wants to have complete control over their budget, not let the state get control of some of their money. Think of it in terms of this scenario: the deadbeat dad (city) fails to pay child support for his children (police and fire pension fund) so the county (state) steps in and garnishes the deadbeat dad's wages to make sure his children are taken care of, see how that works? The only difference is when the real deadbeat dad's wages are garnished he isn't offered all the other nice little options the city is offered by the state. He doesn't get to pay a portion of what he owes his ex-wife one year out of five to avoid having to pay the entire amount he owes the rest of the time.
The City is talking about tax increases for the very reasons given above. Every year the actuarial recommendation is going to increase. If the City, who can meet the actuarial recommendation this year through budget cuts, tries to continue to meet the actuarial every year through budget cuts alone, they will cut themselves right out of existence. They CANNOT do it through budget cuts alone because, even though the City rakes in a lot of money every year and you see them building and redeveloping and planning to do wonderful parks projects and center city revitalization all around you, they can only use the general fund to fund the police/fire pension fund. They cannot take money that taxpayers approved to buy donuts and spend it on bon bons. You see, folks, that would be illegal. Taxpayers didn't approve a bon bon sales tax, they approved a donut sales tax. Taxpayers didn't approve a pension fund sales tax, they approved a parks sales tax. Get it?
Now, the City has to meet the actuarial recommendation in one of the upcoming years but not necessarily next year, they just want to meet it next year because, by meeting it next year, they don't have to put as much in as they would have to if they put it off.
It is a possibility, though, in my view, to put it off next year, get taxpayers to approve of a pension fund sales tax and balance the budget without extreme cuts, if you consider 7% extreme, that is. I like the idea of government shrinking 7%, myself. I'd like to see them scale down.
Now, here's something that's been on my mind. I'd like to see the City bring to ballot a sales tax for the pension fund with the following terms included. Attached to any tax increase proposal:
> A feasible future plan for how the City is going to fund the actuarial recommendation after the tax sunsets in two years.
> City promise that they will draft a bill, with a timeline for drafting it, allowing the citizens to reconsider the Vision 20/20 plan by ballot. (Sometimes, I know in my family, we have these glorious visions for what we'd like to do in the future but other obligations get in the way and we have to postpone the timeline we originally set. Perhaps the city needs to give voters the option to retire the Vision 20/20 plan until it has settled some other priority issues of vital importance. Voters should have a say in this vital decision. There are even other areas in the overall budget that could be treated the same way.)
> An administrative delay on any further grant applications that require matching money on the part of the city. (Often I see city officials mention "this is federal grant money," as if we should all be happy it isn't costing us anything to do this or that except that either way it IS taxpayer money. Often the city has to match a certain amount of funds to the grant. Can we afford to be soliciting grants for unnecessary projects that require matching funds right now? )
Those are just some ideas I had that might make a new sales tax a little more palatable to citizens who feel they shouldn't bear the entire burden for bailing the city out of the pension fund shortfall that the city's own money management has created, for what it's worth. I think the voters would like to see the city match their "grant" of sacrifice for the pension fund with a matching sacrifice. I know I would and without a matching sacrifice I couldn't and wouldn't support a sales tax increase to support the pension fund. It's up to the City to sell me on it. I love our police and firefighters and I want security and police protection, we have a right as taxpaying citizens to expect it but I don't want police and firefighters to feel backed into a corner on this issue. The city needs to make some sacrifices on their behalf before they knock on my door.