There have been many conversations recently about the city’s financial difficulties, particularly around raising taxes to fund the police department. That conversation has turned to the Treasurer’s Office and using Parking Division reserve funds to help the city.
As of the 2016 Audited Financials, the Parking Division had approximately $20 million in unrestricted reserves. Like most companies, the Treasurer’s Office uses this reserve fund to insure its outstanding debt. The Parking Division’s reserve fund insures approximately $67 million of outstanding debt that was accrued for building parking garages and upgrading the parking meter system. Having a healthy reserve fund allows the Treasurer’s Office to borrow money at a lower rate and saves the city money.
Other city departments keep reserve funds on hand as well, including the Water Division with $34 million in reserves and the airport with $150 million in reserves. The city itself also has approximately $7 million in reserves.
During Treasurer Jones’ first term, her decision to increase the Parking Division reserves resulted in the Treasurer’s Office receiving a credit rating upgrade. The Treasurer’s Office also consistently gives more money to the city’s general fund than is projected in our budget. We also submit balanced budgets every fiscal year, as required by state law.
While using reserve funds sounds like a good idea on the surface, the reality is it won’t work. It would be like a doctor using band aids when a patient needs surgery. It’s a short-term solution for a long-term problem.
What we should be doing is looking at the city’s entire financial picture and asking some tough questions. Are we operating efficiently and using the appropriate software to automate certain processes? Are we upgrading technology so our citizens can access basic city services online? Do we use typewriters and triplicate forms instead of moving toward a paperless office? Do we have the right staffing mix given recent technological advances? Are tax subsidies being used to responsibly encourage development, or are they hurting the city’s finances?
The city needs to be looking at long-term, sustainable and realistic solutions for public safety and the city’s financial difficulties, instead of looking for a quick fix.