Remarks for 2018 Budget Presentation to City Council

Thanks to Council for stewardship through the years, for sustaining this great city and achieving so many important goals while protecting financial security and working toward more sustainability for future generations.  I’ll note a special thanks, perhaps he’s watching, to Tim Mayer, who as a long-time member of council, reviewed and supported many of these budgets. Thanks to staff for hard work. (Mick, Jeff, Mary Catherine, Tom, Elizabeth, and department heads – our cabinet which meets together every two weeks). Special thanks to the 700 city employees. Every hour of every day, on the job.

Tonight is a preview of 2018 budget…all available on line…we look forward to 4 nights and then more discussion of priorities….including from council, and then final action in September (note that re office of council and clerk, we are just forwarding your own developed budgets)

We do many things together, our city administration and council. This document we develop and enact together is among the very most important policy document we will create this year. It’s how we set our priorities.  As each of our 15 department heads shares their goals for 2018, you’ll discover that our priorities for 2018 continue to include economic health, public safety, affordable housing, and efficient operations. And you’ll see the impacts of our several community task forces and their recommendations.

With the budget, I always emphasize transparency and accountability. Budgets should be where we SAY WHAT WE’LL DO.  AND DO WHAT WE SAY.  We began an emphasis last year, being specific about what each of our departments seeks to accomplish with their public resources. Why and how they do what they do. You will hear from each department head a brief, interim report on 2017 – where are we on this year’s goals, and then a fuller outline about 2018 – key objectives and specific measurable goals. And greater detail of course is in the written budget. Those goals are developed extensively through strategic planning, within departments, and at the cabinet level. And they are informed among other things by the new biennial city survey, which includes data about what our residents care about, and want they want to see improved, changed, or retained. (you’ll see funding to continue that biennial survey)

These detailed 2018 goals, embodying transparency and accountability, are working goals. They are not final. We will continue to refine them through development of this budget, with advice from you and through your final action in adopting a budget. Indeed through implementation all next year. And I want explicitly to thank all the department heads and particularly deputy mayor Renneisen and controller Underwood for the extensive work to provide so much detail to the community.

Tonight my comments will include four basic sections:

1. A basic fiscal overview – of our overall operating budget, and assets

2. Policies guiding the budget - brief principles, and context

3. Key citywide priorities, reports on 2017, and goals for 2018

4. Closing with a couple special projects

Section 1: Basic Fiscal Statement...Where we currently are:

• 13 departments directly under OOTM jurisdiction, with 700 Employees (inc CBU)

• 2 affiliated & overseen with another 140 employees (BT-107, BHA-31)

• $128 million total operating budget for the 13, including $43 MM from the general fund and $44 MM at CBU

•  Another $22 MM from the affiliated 2 entities

•  i.e. about $150 MM in annual spending being reviewed. (in the city’s direct budget, $84MM, or about $1,000 per resident; not including CBU, BT or BHA)

• Capital investments are of course fundamental as well, generally not thru the annual appropriation process. Will also be discussed briefly.

•   Assets owned by the 15 departments/organizations:  Overall value is estimated at $700+ MM, at historic cost. Replacement value certainly well over $1 BB for all the thousands of acres of land and parks, our water reservoirs, our buildings, all our equipment, hundreds of street miles and pipe miles, and sidewalk miles and path miles, over 3,000 fire hydrants, and hundreds of vehicles owned. It’s critically important that we keep up that very large base of assets.

Revenue summary – revenue from our property taxes is up 4% based on growth in levy from state formula (with caveat about caps, below). Local income taxes still awaiting projection for full information; we’ve assumed zero growth in the LIT for this budget -- a conservative but I believe appropriate approach. Other revenues you will hear more from Jeff Underwood. TAX CAP impact - this is worth emphasizing. We are seeing impact this year of $1 million lost to tax caps.

You will hear the specific financial details as 15 departments from the mayor’s office and affiliated organizations share their organizations’ overviews.

Section 2: Overall Approach

In approaching the budget, a first principle is maintaining prudent reserves, and maintaining our assets, both physical and human. That is, take care of what we own and who we are. And a second principle is investing in the future -- creating value tomorrow, for all our residents from all walks of life, by investing today in the programs and activities and assets that help us all reach the next level. You’ll see in the budget that I have recommended that while keeping our reserves at a healthy number above 30% of annual operating expenses, we can protect against those property tax caps from damaging our ability to continue forward-looking investments.

The 2018 proposed budget continues efficient and responsible fiscal stewardship with healthy reserve balances and growth commensurate with population and needs. We identify key opportunities and challenges to which our budget should respond.

Our budget responsibly maintains and/or replace assets, be it equipment or physical infrastructure. In approaching the budget, we keep front and center the importance of stewardship -- taking care of what we have, and improving it over time.

Our budget continues to invest in our people in basic ways, and by remaining flexible and offering appropriate incentives:

• This budget includes a 2% raise for non-union employees.

• 1% dedicated to training and skills building

• $15/hour minimum for all permanent city employees (only exception is summertime temp employees, like pool attendants, camp counselors, etc.)

• equipment – SCBA, fire gear, vehicles, etc.

• 50% of reversions to departments;

• $25k for awards to outstanding employees or teams;

• sets aside $250K in 2018 for down payment on any adjustments as needed based on our ongoing salary survey (first since late 90s).

Section 3:  the Basic Goals

Our priorities for 2018 continue to include economic health, public safety, affordable housing, and efficient operations. I’ll outline just some key aspects of this continued focus. I note as well the important impact of the several community task forces that have helped create a transparent and engaging process to identify continued efforts.

Economic Health

Good jobs and the local economy are the foundation of all we do here in Bloomington. They support all the people living, learning and working here. We will continue to focus on strengthening a more sustainable local economy, through our infrastructure investments, and through our department of economic and sustainable development. That includes continued work on our digital infrastructure, with ongoing discussions with potential investors. It includes working with IU Health on their $400 million planned investment with IU in the new hospital and academic sciences center. It includes continued work on the String of Pearls, along the B-Line, from the Switchyard Park at the south to the Trades District at the north. And you should hear more about the potential new downtown convention center in the coming months, as well as the community-wide process to identify options for the current IU Health hospital site.

We also continue to work on the six core recommendations from the Wage Growth Task Force, which you’ll hear more about on Wednesday evening with the ESD department.

Public Safety

Government’s first job is protecting and enhancing public safety. We continue addressing overall crime, whose reported numbers are not moving down as we want. A complex web of issues confronts our city….including opioids and overdoses and addictions and mental health issues, all compounded by housing affordability and the need for wage growth.

Public Safety projects, such as those recommended by the Safety, Civility and Justice Task Force, continue to be implemented week by week. We would like to thank businesses, individuals, and so many organizations and governmental actors who have been active partners in improving public safety for all in our community, with new job programs for under-employed individuals, and increased activity on the streets to deter illegal behaviors, and increased lighting, and parks programming, and training, and public health efforts to reduce addiction and mental illness. We know this all is work-in-progress, and, to properly function, requires a community-wide effort to sustain our progress. Just as one example, I want to thank the county and private sector who have stepped up to help keep Shalom Center open over the weekends as a year-long trial effort. And you’ll see a request for $125,000 for future implementation of the Task Force’s recommendations.

You’ll also see major investments in the basic public safety infrastructure of the city -- our police and fire departments. Nine new positions are added to the police department, including six in the dramatically over-stretched dispatch center, and funding to support three new officers on the street, including one additional downtown resource officer to expand that very effective program. The fire department will continue its increased training and equipment upgrades, with new breathing gear and basic fire protection gear for all our firefighters, as well as replacement of our single most expensive apparatus, our aerial ladder truck.

Please know that the new county-wide Public Safety Local Income Tax has been an essential source of support to allow these much-needed investments in our basic public safety services.

Affordable Housing,

Our community must be affordable for people from all walks of life. We have work to do on this. Much progress is underway with affordable housing in projects, like Crawford 2, PedCor in the Trades District, Evergreen for seniors, Urban Station, Dunn Hill investing in the Housing Fund, Adams Crossing, Park South, Habitat’s continued work, and the new nonprofit affiliate of our Bloomington Housing Authority, ‘sigh-ho’ which received a land lease to do affordable housing adjacent to Switchyard Park.

And we’re making progress as well on affordable housing programs – the Comprehensive Master Plan and the Unified Development Ordinance on the way; pocket neighborhoods approved; a pilot for tiny homes under consideration. But we have much more to do. You’ll see our request to begin investing up to $1 million of the new affordable housing fund in new projects going forward.

Efficient and Transparent Operations

Every day of every week we work to improve the efficiency of what we do in government, and to expand our transparency and accountability to the public. You will hear examples through the next four evenings about what our different departments are doing in that vein. I’m proud of progress we are making. I’m also committed to continue these efforts energetically.

In the spirit of accountability, I’ll particularly call your attention to some of the 2017 goals we outlined a year ago, about which you’ll hear updates this week, including the reformed sanitation system, the investment in energy efficiency and savings (including our major push for new solar during the next 5 months), our 2017 public safety investments, our increases in transparency through B-Clear, weekly public meetings, and our citizen survey, and much more.

Efficiency includes stewardship, which I mentioned before. Taking care of what we have and investing in the future. That includes capital investments, not in the operating budget under consideration this week. But it’s important to know that over the next three years we plan to invest more than $80 million in our infrastructure, including Switchyard Park, the Trades District, Solar Energy, Trails and Paths, Intersections and Sidewalks, existing parks, and existing water and sewer lines. This unprecedented level of basic investment in public infrastructure reflects our collective commitment to doing the basics right -- maintaining and enhancing the foundational assets of our community, improving our sustainability, and building momentum for the future.

Section 4: Special Projects

I’ll close with two areas that I believe deserve special attention this year.

First is the City of Bloomington’s Bicentennial. It’s a big deal to turn 200. And that’s in 2018. I don’t tonight want to suggest the details of what I think that means and offers to our community. That’s a big and long discussion with a lot of people and input. In terms of the budget, however, I want to point out a couple things.  First, we’ve earmarked in the operating budget $250,000 for 2018 related to the Bicentennial. That’s a significant amount of money in itself. But we also will be identifying additional funds in the capital budget, from bond funds and other sources, for investments related to the coming Bicentennial, to make in the coming years. To celebrate our heritage and invest in our future demands real investment. And I’m going to suggest that we ought to expect to earmark $250,000 each year for the next several years to implement the activities we agree on related to our Bicentennial. That operating money and the capital sources available should allow us to help pay forward some of the incredible benefit we have inherited from 200 years of our predecessors.

Second is investment in quality pre-school. This is a new area, so far as I know, for the city budget. Pre-K investments directly from cities are growing around the country, from New York City, to San Antonio, to Seattle, to Philadelphia, Dayton, Ohio, and more. So far as I know, only one city in Indiana has such a program and that’s Indianapolis.

Our community’s long term success depends greatly on assuring that our youngest residents get a good start on life. Working parents are the norm in most homes, and, it’s critical that good quality childcare is available for all. I don’t believe that city government can shoulder all or even most of this burden -- families do much directly. The federal and state government do some, and should do much more.

But we can do something locally.

In looking at our economic future, the Wage Growth Taskforce said early childhood education is one of six pillars that the city ought to focus on. Every dollar initially invested in early education programs for children from low-income families is estimated to generate $4 to $11 in economic benefits over a child’s lifetime. Participating children have a higher rate of finishing high school and college, score better on tests, request less public assistance, and enter the workforce at a higher pay rate -- and a higher tax bracket -- than peers without similar opportunities. Estimates are that several hundred 3 and 4 year olds in our own community would benefit from subsidized quality early education. And if they would benefit, so would we.

That is why I am proposing that we create a new line item in our 2018 budget:  I propose that we invest $100,000 to support quality child care for lower-income families in our community. To do this, we’ll be collaborating with the Community Foundation and the Regional Opportunity Initiative and their major commitment to this issue, as well as with local providers. We’ll encourage and welcome additional state resources to the community. The city should be a partner with these organization in addressing this major challenge.

I know this is a new step. And while it may be a modest step, I believe that it is a step in the right direction.

That’s enough from me for now. I’ll end where I began, with thanks for all of your work on behalf of our community, and your support for our city government -- our people, our programs, our facilities, and our goals. Indeed support even for our shared dreams. We are SO FORTUNATE, to live here and now, in Bloomington, with such promise and potential. I look forward to our continued collaboration, on how best to lead Bloomington into our 200th year and beyond, to a future that is better and brighter, for all who will enjoy the chance to be part of this great place we call home.

I’ll be happy to take questions or comments, and then look forward next to Controller Underwood’s presentation about some more basics on the proposed 2018 budget.