The $83 million pot of gold

I decided to come out of the woods for a while and follow the money trail over at City Hall. The quest led me to City Council’s budget work session, a meeting on affordable housing, a public hearing on the budget, and a series of meetings with city decision-makers: Asheville’s budget director, city manager, assistant city manager, mayor, chief of police, and City Council members. In the end, I was on hand to see the budget passed at Council’s June 13 formal session.

One thing’s clear, after poring over the charts and figures in City Manager Jim Westbrook’s 158-page budget proposal: Allocating $83 million — most of which is gathered as taxes from 68,000 local folks — is a daunting task.

I wanted to find out where all the money goes, and why Council seemed so ready to raise taxes and fees to pay for road improvements, sidewalks, park improvements, an affordable-housing trust fund and an $11.2 million parking garage.

But right now, let’s just focus on what I learned about personnel costs — about $44 million, which gets divvied up among 993 employees. The cost of salaries, wages and fringe benefits for city workers now accounts for about 60 percent of the total budget, according to Budget Director Ben Durant.

Half the lcoal work force earns less than $25,000 a year; these wages remain stagnant, with little sign of improvement, and most workers in this category have little in the way of benefits (such as medical coverage) Meanwhile, most city employees make several times that amount (see accompanying charts).

I showed these charts to a number of city taxpayers, including Richard Stiles, a financial consultant at Wachovia Bank. In his opinion, the city-government pay scale is partly determined by those of other, similar-sized cities, and by private-sector pay scales. Stiles said he’s sure that some “city leaders could earn more money in private industry.”

Unlike private-sector managers, government managers are more insulated from economic realities, said Stiles, noting the recent layoffs at Beacon Manufacturing in Swannanoa. “Civic managers don’t have to hold their fingers to the fire like industry leaders. They can raise taxes to cover their losses,” he said.

On the other hand, two friends of mine, Sahn and Allison, had a different reaction to the city’s pay scales. They’re among the many who make less than $25,000 a year. In budgetary lingo, they work in the service sector, which accounts for 28 percent of the local work force (the largest single sector). Both are employed at Focus On Children, a local agency working with at-risk (“Willy M”) teenagers. Since the recent arrival of their infant daughter, Morgaine, they’ve been saddled with maternity bills — and have barely been able to keep their heads above water, even though Allison has worked 50 hours a week for the past nine months, while Sahn has taken a second job and now works 70 hours a week.

They work hard to balance their budget. “With $525 in rent for a small apartment, [plus] vehicle expenses, food and the medical bills, there’s little left,” explains Allison. “We want to raise our daughter here, but with low wages and the cost of living rising so fast, we may have to look elsewhere. When I have to pay more and more for something like parking downtown for work, it really irritates me.”

Sahn and Allison provide a critical service for their fellow Ashevilleans, and they stay current with local politics. Like most people I talked to, they were surprised by the salary figures. Sahn talked about the national crisis stemming from the growing divide between rich and poor. “With those kinds of salaries, they’ll grow this city as large as they can [and] lose touch with the realities of over half the people,” he said.

At the June 13 City Council meeting, Mayor Leni Sitnick and Council member Ed Hay attributed many of our current financial woes to poor decisions made by previous councils that, Mayor Sitnick claims, “have passed the buck for years and years.” They both reiterated that taxes haven’t been raised since 1991. Sitnick added, “This is not easy [raising taxes], but it’s what we have to do.”

Council seemed to agree that capital outlays are getting squeezed, given the high costs of personnel, debt service, vehicles and equipment, contributions to outside agencies, and the burden of Civic Center losses, along with unavoidable contingencies. So, in order to finance road and sidewalk improvements, park renovations, new water lines and a housing trust fund — Council voted to raise property taxes, parking rates, recycling fees, vehicle-registration fees, and sewage-and-water rates.

At numerous points, Council member Terry Whitmire attempted to whittle down the budget, proposing cutbacks on the city’s contributions to outside agencies and a temporary freeze on hiring more personnel to fill vacancies. She was voted down on every measure. In the end, Whitmire voted against the budget, as did Council member Brian Peterson.

In his closing remarks, before casting his vote against the budget, Council member Charles Worley offered a word for people like Sahn and Allison. He said: “I’ve listened very closely to what people are saying to me. And I’m hearing a lot. … But one letter I received sums it up.” He held up a letter from a constituent who wrote, “Make do with what you have.”

Is “make do with what you have” a lost concept in contemporary society? Or, for bureaucrats, is the idea more like, “Make do with what we can get from the taxpayers”? How representative can local government be when the primary decision-makers earn three to four times as much money as half their constituents? And then, in order get city government to take care of its most basic civic duties, these same managers declare the need to raise taxes and fees, increasing the burden on many whose budgets are already stretched to the limit.

That night, each Council member pledged to do better next year. Hopefully, with a stronger voice from the “lower half,” we can hold them to their word, and make them better stewards of the $83 million pot of gold at City Hall.