2023 City Budget Remarks to City Council

Good evening, and thank you Council for welcoming our administration once again to present the proposed city annual budget, over the next four nights for the calendar year 2023. As usual, I will share some overall comments and an outline of the entire budget first and will be followed by Controller Underwood and HR Director Shaw, then the full series of city department heads in the coming evenings.

We should begin with a Land and labor acknowledgment….

Let me also at the outset thank the staff who have worked so hard (cabinet…. 

So to the budget. With some essential context. 

First: Let’s remember what we’ve been through in recent years: A once-in-a-century global pandemic. A major recession. The worst US presidency in history. An accelerating climate emergency. Pernicious ongoing realities of racial and other discrimination. And continued radical agendas from our state government on guns, public education, and now most outrageously on reproductive rights. Effectively banning abortions in Indiana as of 17 days from today. 

In the face of all this, since 2020 we have a powerful and welcome partner in the federal government (with CARES, American Rescue Plan, Bipartisan Infrastructure Bill, the Inflation Reduction Act, CHIPS, and more). Locally since 2020, we have together invested through Recover Forward to protect and advance our community. All with the incredible, essential public servants in the City of Bloomington. (Amid hard times to be a public servant).

Amid all these challenges, and with our mutual commitments, we have made enormous progress: 1,100+ units of affordable housing; significant local wage growth; unprecedented new digital equity program and new infrastructure; always-improving outstanding parks and trails; and our Hopewell and Trades District projects. Essential investments in economic development including our arts and local food sectors. And our potential Conv Center and Showers/City Hall expansions. As well, CBU, BHA, and BT continue to innovate and upgrade and be leaders in our state and region. That’s collaboration and results to be very proud of.

Second for context: This proposed budget is a product of months of collaboration and listening. To council members. To the public (including our 3 biennial city surveys - 4th coming in 23). Look forward to continuing all of that collaboration in the coming weeks. We began with meetings and discussions in April - dozens of conversations and meetings since that have informed and shaped this budget. Including of course all the debate and work on the new Economic Development Local Income Tax and its designed uses.

To Main Event: The annual city budget is our most important single policy document. It reflects many interests, priorities, and tradeoffs. My job is to present a coherent and balanced budget. I would also say a progressive budget to meet our times. State law outlines the process we follow, with lots of Bloomington additions.

Tonight is my seventh budget presentation. And no doubt this is the most significant of those seven. It is transformative. It is not an overstatement, in my view, to say that with this budget we will be ushering in a new era for Bloomington.

Out of the pandemic and recession and more, this transformative budget leads into a new future, into this decade of the 2020s. In a way, we are making Recover Forward permanent – instituting it into city plans and budgets, with our focus on building climate justice, economic justice, and racial justice. 

We know also we face significant Inflation and wage and hiring and retirement pressures, as an employer. Like all employers, these are challenging times. And, as a public employer, we note that democracy itself is under pressure. We have, I believe, a special obligation in these times, as a government employer, to make sure our city government is healthy and nourished, up to the tasks of providing services and meeting the moment, and sustaining a healthy democracy. If you believe that democracy is under serious threat, we have special obligations to make sure our local democracy, embodied in our local government, is vibrant and vital. 

Permit me to share a few general observations about how this budget meets those opportunities and challenges. (Of course won’t get into the dozens of details about programs and changes, to come during this week’s presentations)

First, Start with the basic numbers. 

With ED-LIT and ARPA and other revenue, the General Civil City budget is $129MM (versus $107 for 2022). Up $22 million or about 20% from 2022 to 2023. The Total budget, when including Utilities, Transit and Housing Authority is $229MM (versus $178 for 2022, or a 29% increase)  [ CBU ($48MM), BHA ($16.5MM), BT ($35MM)]

I’ll go into what those investment levels mean in a moment, And Controller Underwood will add details shortly. Let’s note that the healthy growth of Prop Tax Levy, general income tax revenues, and in particular the new ED-LIT adopted by this council unanimously in the spring, and continuing federal supports allow all of this.

This TRANSFORMATIVE budget is best understood with Three Focus Points. 

1. We strongly support City employees and all government basic services and affirm the central role of great public services. This budget helps us be a “Workplace of Choice” for ALL our employees. It embodies the notion that we have an ambitious and innovative city government that is an employer of choice, delivering cost-effective modern services, in ways that advance the quality of life for current and future generations of Bloomingtonians.
2. We embrace Sustainability - in particular with transformative investments in public transit and our Climate Action Plan. We know this makes a stronger community. It embodies the notion that Bloomington is committed to addressing the climate emergency and building a sustainable, equitable economy. 
3. We embrace inclusion and justice - a city that welcomes all and works for all. This embodies the notion that Bloomington is committed to being a safe, just, and inclusive community where everyone belongs and can thrive, including with good jobs, affordable housing, and inspiring arts and public spaces.

Next, I’d like to highlight in more detail some major changes in this Transformative Budget:

Let’s dig in a bit into how this budget embodies being an Employer of Choice and strengthening all our basic services.  This budget makes unprecedented investments in all of our people, strengthening all of our basic services. Supported by the ED-LIT and federal resources, this budget proposes:

1. 5% COLA for all non-union employees. (With unions receiving their contracted amounts - FOP 13%, BFD 2%, AFSCME TBD)
2. Reflecting the special challenges of this period, from inflation to pandemic to public service generally, a $1,000 bonus will be paid quarterly–to all employees except sworn BPD officers and dispatch staff who recently have had their own significant adjustments and COLAs.
3. New Deferred compensation matching program (available to all employees, union or non-, up to $780/yr) matched either 2 to 1 or 3 to 1 for voluntary employee contributions.
4. Establishing a primary care health clinic for employees and families by Q4
5. Firefighter (like police) housing assistance ($18k downpayment, or $750/mo rent)
6. HR Director Shaw will share more details shortly, including health care benefits, parental leave and tuition reimbursement pilots, salary studies, and more.

The budget proposes 17.5 net new positions in the civil city, with another 13.5 planned by Utilities (6.5 FTE) Transit (5), and Housing Authority (2).  Most of these are paid for by ED-LIT and other sources besides the general fund. 

Public safety receives particular focus. We have outstanding public safety services: still the only city in Indiana with a top-ranked certified fire department (ISO 1) and a nationally accredited police department. With declining crime rates, zero fire fatalities, and 10 saved lives in the past six years. Both departments continue to evolve and innovate, leading to progressive change. More tomorrow evening. For now, note the budget funds 9 new public safety positions, including a social worker to operate directly with 911 Dispatch, two fire health interventionists at fire, three new Comm Care Specialists at police, a public safety recruiter, and a new position at CFRD as well. Plus the budget funds housing incentives (7 police rental; new fire) and of course needed new facilities for both police and fire.

Other basic service investments are protected and strengthened by ARPA. National accreditation, continues (built off Parks, added BPD and BFD. Note that BHA, CBU, and BT have related experience). Next up is Public Works accreditation in 2023.  And Trello 2x annual reports (big deal re 564 specific goals and outcomes for 2022)

[Parks double gold medals; BHA and BT and CBU transforming; Sanitation; Aff Housing numbers; Planning volume of work; ESD and CFRD….all supported by internal departments.) AND also pursuing an extraordinary lineup of opportunities: Meridiam, Hopewell, Trades, Switchyard, Conv Ctr, Arts, wage growth, and jobs. – and all with inclusion and sustainability lenses. And got thru an international pandemic.]

As to sustainability, this budget is indeed transformative. We begin an annual $1.6 million appropriation directly to fund our Climate Action Plan. You will see details of that range of investments with the Economic and Sustainability Department. And of course, Transit is entering a new era. This budget reflects a planned memorandum of understanding to invest just under $4 million in local dollars to expand public transit services. BT’s annual budget leverages local funding to grow from $15 to $35MM in 2023. (They already were awarded a new $7MM federal grant for 8 new electric buses.) Just to compare our very very significant level of effort locally, let me offer this comparison: the Federal $375BB climate investments of IRA = $1,100+ per capita over 10 years. Our $5.5MM climate = $650 per capita over 10 years. 

As to inclusion and justice, this budget also sets a new high bar. With ED-LIT support, we are investing $1 million directly in affordable housing (adding to the $5 million in one-time ARPA money this year and last) and another million dollars in the econ equity fund, to support low-income working families facing struggles. We look forward to working with you on details of this and other programs, including more than $300 thousand in funding for job-readiness and local food and arts programs, to continue the critical momentum of Recover Forward into the future. We also continue the work of the Racial Equity Plan, the Future of Policing Task Force, and the DEI collaboration with IU and other partners.

With this transformative budget, we are doing many new things. And expanding future-oriented efforts. We also can’t keep doing everything that we do today. We have to set priorities and pivot away from things too, that let us save money and address future priorities better. 

One way we do that is by doing more work without more staff or resources. This budget does not expand the number of HAND apartment inspectors, even though each inspector is today responsible for 27% more apartment inspections than they were in 2010. They are getting more and more efficient. Our 8 fleet mechanics today are each responsible for 42% more vehicles now compared to 2004. We are proposing to add one mechanic in this budget, which would mean each is maintaining 27% more vehicles than they were in 2004. 

Other more direct changes are proposed in this budget, making some hard choices:

1. We plan to reform sanitation, putting it on a 3-year path to zero general fund subsidy. This continues our reforms of 2017 and depends on council action and adjustment to cart fees.
2. We’re planning changes to our leafing program. With continued regular lawn waste pick up; and intensive support for mulching and composting. And the termination of the free curbside vacuum service for 2023.
3. We plan to seek to transfer Street sweeping responsibilities to CBU, focused on their  stormwater management, which can increase the level of street sweeping substantially, and may be accomplished with a 1 or 2-year subsidy to support the transfer
4. We plan to develop a reduction or elimination of coin services from our parking meters. This will save money, allow more flexibility in our banking relationships, and will also be accompanied by improvements in the meter protocols, to give customers a better experience and options.
5. We plan to convert a parcel of city-owned property – likely a surface parking lot – into affordable housing next year. Work together to determine which one and how. 
6. We plan to convene a review of our 911 protocols and deployments, to maximize efficiency and reflect our community values, to review how best to deploy our sworn public safety resources, and identify best practices nationally.

These adjustments will let us reassign existing employees from some of these activities to more sidewalk improvements and clearing, installation of ramps and better paving, expanding Brighten B-Town, and perhaps snow clearing as well. 

So to summarize:

Budget size $129MM vs. $107MM. (20%).  And total w 3 ‘outside’ is $229MM vs. $178MM in 2022 (29%)

Positions 17.5 net new civil city jobs (plus 13.5 at three affiliated entities (about 3% growth)

Major new investments, unprecedented and transformative, supported primarily by ED-LIT:  $16MM and ARPA of $5MM.

Finally, after that review of key components of the 2023 budget, I’ll conclude with some Updates: 

As to ARPA and Recover Forward to date: 2021 was $3.4MM for Housing, nearly $1MM ESD, and $700K Lead abatement. 2022 was $10MM for Housing ($3.6), ESD ($1.6), Revenue Replacement ($3.2 police, fire, parks, streets), Infrastructure ($1M IT and Eng’g), and $500k for Covid payments. 2023 is $4.9MM for Revenue replacement (Capital for parks and engineering at $2.9; streets for operations, street sweeping, traffic management enhancement) $400k for project management of major projects ahead, $335K for ESD, and $150k for tuition reimbursement pilot for personnel. More details to come with other presenters.

We shared a memo last week updating the Council on five topics, which I’ll just itemize here and happy to take questions about:

The two 5-year bond projects gave full updates. (including two projects we’ve been able to proceed with outside the bonds: - Griffy Dam crossing, and 25k for battery equipment at Parks). 

Updated the Hopewell project and the potential Showers building purchase.

And updates on our regulation and management of electric scooters locally, as well as some potential new composting efforts. 

We are working as well, as you know, to activate and advance the potential expansion of our downtown Convention Center, which could be a substantial effort yet this year, in 2023, and beyond.

Two issues that are not items in our city budget, but I believe are major challenges in our wider community’s budgets. One is the challenge of criminal justice reform. And the second is our public health system, in particular, our mental health system and support for people experiencing substance use disorder. These are all related. Not the time and place for details tonight, but just emphasize the importance of major upcoming investments in both of these areas, I believe. As part of transforming our community’s future 

Having presented this budget, note public input will continue, ongoing. From council, and public, and commissions, etc. 

We are fortunate to live in a great city of Bloomington, Indiana. I am pleased to present a transformative 2023 budget that makes our future even brighter – more sustainable, more just, more inclusive, with a city government staffed by some of the finest public servants anywhere. Thank you.