You know, the devil’s in the details when it comes to just about everything. Especially government, and most especially, government budgets.
Take next year’s proposed city budget. I’ve been through this thing line by line, with a fine-toothed comb, ever since we got the “final draft” in early August. It’s a lot to digest. Lots of numbers and all. But some numbers are more important than others, and right now I want to focus on debt and its effect on our bottom line.
The city borrows money to make major infrastructure improvements, like constructing new libraries and police stations, building new roads, putting in new playgrounds in our parks. These are bond projects approved by voters. When we borrow money for these projects, we’re essentially putting them on the city’s credit card.
As with any credit card, the city has to make regular payments. Next year, our credit card bill will be about 22% of our entire operating budget. It’s the largest expense after police. Take a look:
Next year, the city manager proposes to charge an additional $314 million to our credit card. The critical question is: How will that affect our credit card payment? Well, it won’t make much of a difference next year. It’s the following year we have to worry about.
See, if we decide to borrow $314 million next year, then the following budget year we’re going to be up a creek without a paddle. Our credit card payment will jump by $24 million. TWENTY-FOUR MILLION DOLLARS.
Why am I shouting? Because I’m worried about this. Really worried. Because if we have to spend $24 million more on debt repayment, that means $24 million less that we’ll have for all our other city services: police, streets, parks, libraries, code, the arts, etc. Continue reading