Why hasn't our big spending, local government started budget cuts?

With the coming recession it is time to batten down the hatches. People are losing their jobs, houses, and seeing costs for necessities like food, fuel, and electricity going through the roof. What is the government doing to cut back?

Businesses react to downturns by cutting expenses and making preemptive cuts to prepare for bad times. The average person cuts back on eating out, buying a new car, or fixing up their home. That is if they have a job. What is our local government doing?

In the face of decreased tax collections, the state government is cutting back on services and programs too. The fact that Democrat Phil Bredesen is proposing massive budget cuts should embarrass the Republican party who keeps telling us that they are conservative. These extensive cuts are to make sure that we are in the constitutionally mandated balanced budgets without raising taxes.
It is obvious that County Mayor Claude Ramsey, City Mayor Ron Littlefield, and both city/county councils have done nothing preemptively to address these looming budget deficits. As a matter of fact they are increasing spending at an alarming rate. Not only that, these big "pie in the sky" projects, past and present, are going to make things a lot worse.

The first tax black hole is the downtown debt. It is $500 million, while collecting about $3 million in sales tax, and paying over $13 million in debt service every year. If tax collections decline because of a bad economy, Dan Johnson, said in a 2005 article in the TFP article that will would be OK if the economy stayed good, but would have trouble paying this debt service if the economy tanked. Even more evidence of irresponsibility is the city council just passed a $500,000 expenditure for another city park. What is wrong with these people? Do they follow the news?

Secondly, the local governments are also going to get increased budget requests from the schools, sheriff's department, and general government. Some are just inflation, some are bad management, but they are going to happen. This is going to be another burden for the taxpayer and the reaction will be to attempt to raise taxes. Not only that, funds that helped pay for this stuff from the state are going to dry up, like the BEP money, and that will put even more pressure on our local governments.

The third budget buster is going to be the Volkswagen deal. It is already putting pressure on the local and state budget. We have heard the claims and promises of how much revenue we are going to get in the future for this unwise "investment" but if it is like the wonderful downtown it will also be a taxpayer flop. In any event, the short term financial pressure from VW on the county/city government is going to be huge. Other pressures that are just as large are pension and benefit cost increases for county/city workers. How are we going to pay for this stuff?

The fourth factor is decreased revenue from development. It is obvious that home building is a big factor in the revenue growth picture for the county and city. This type of development is not going to increase or even be maintained for several years. Not only is the value of real estate declining, in some cases it is changing to the point of your loan being more than the value of the real estate. If that happens, reappraisals will have to be readjusted to reflect the new values. That means less tax collections and if history is any indication we can expect another property tax increase if budgets aren't cut.

My suggestion is an immediate 10% decrease in the county work force and another 10% decrease in all department of the county government. Also, an absolute freeze on any new spending including VW expenses that weren't previously negotiated. This should be followed with another 10% decrease in the county work force by attrition. This would save almost $60 million dollars and put us on the right road to fiscal responsibility for a change.

Now we are left to just wonder, what in the heck our local governments could be thinking? What are they doing about it? Nothing. They are "hoping" and "predicting" that we will be ok and they continue to buy votes from us with our money. That is not enough. If we are going to avoid local tax increases, our local officials need to start talking about budget cuts. A tax increase on a financially battered population is not an option.

Tim Price
jat-55@msn.com