Mayor on 2021 Bloomington budget: “I do believe in a countercyclical government, so keep your ears open for that.”

Bloomington’s city council held its 2021 “budget advance” meeting last Wednesday. The meeting is an annual chance for councilmembers to tell the administration what their priorities are for the coming year.

Cropped Budget Advance Screen Shot 2020-04-29 at 6.33.29 PM
Screenshot of Zoom videoconference for Bloomington city council’s budget advance meeting on April 29, 2020.

Sidewalks, bike lanes, food security, and leaf pickup were among the specific topics that councilmembers discussed. The general theme was uncertainty about revenues due to the COVID-19 pandemic.

This year, the council’s budget hearings are scheduled to unfold on successive nights between Aug. 19 and Aug. 22. At the end of September the council will hear a first official reading of the budget, which can be different from the version that’s presented during the hearings.

Final adoption of the budget is expected on Oct. 14.

On Wednesday, controller Jeff Underwood sketched out a fiscal picture for councilmembers that included solid reserves—cash balances and a rainy day fund that are enough to cover 38 percent of general fund expenses for a year. With no revenue at all, the city could pay its bills for longer than four months.

But Underwood listed out some ways that future revenue is uncertain, due to the COVID-19 pandemic.

Property tax revenues could be affected by increased default rates and flat assessed values. Local income tax revenue could be down by as much as 25 percent, or $3 million in 2022. Parks program fees will be down. Parking meter revenues could be down from April to July this year by 78 percent or $800,000. Food and beverage tax revenue could be down by 80 percent for the same period, which would translate to a loss of $865,000.

The only question about the impact of the COVID-19 pandemic is how much of an economic downturn it will cause and how long it will last. So one common theme on Wednesday was one of uncertainty.

The city’s mayor, John Hamilton led off Wednesday’s proceedings with a set piece on three “stubborn facts”—the COVID-19 virus, the CO2 molecule, and income inequality.

Hamilton hammered on the point that government can be countercyclical—able to push against the overall state of an economy.

During the council’s discussion, councilmember Susan Sandberg said when she thinks about Bloomington’s local government response, it makes her think of FDR, the New Deal and the Works Progress Administration.

Asked on Friday during a weekly press briefing if he was hoping to make the budget proposal for 2021 a kind of “Green New Deal for Bloomington,” as a way out of the COVID-19 downturn, Hamilton didn’t commit to that. He did re-affirm the idea that government can be countercyclical:

I actually think government should be countercyclical, it’s one of the most important things we can do. Individual institutions facing the pandemic, facing the economic punch in the face that we’ve gotten as a community, individual institutions need to respond kind of for their own best interest and survival. But I do think the role of government is to be countercyclical, to try to minimize the damage, limit the cost, expense, the pain, as well as to facilitate the recovery….

On the budget, Hamilton said on Friday he wouldn’t go into much detail, because the process is just starting, but added, “I do believe in a countercyclical government, so keep your ears open for that.”

On Wednesday, councilmembers expressed support for Underwood’s idea of taking a “strategic” approach to any cuts, as opposed to reducing expenses across the board. They generally encouraged the administration to take the chance provided by the COVID-19 pandemic to take creative approaches making sure spending priorities are aligned with the community’s goals, as expressed in various adopted plans.

Several of the more specific ideas councilmembers floated as priorities involved transportation.

Councilmembers Matt Flaherty and Isabel Piedmont-Smith said they supported an idea that council president Steve Volan had championed at last year’s budget advance meeting: a parking cashout program for city employees. The program would price the city hall parking lot at a market rate, instead of the drastically discounted rate paid by employees. But employees would receive a “raise” equal to the increased cost of parking. If employees choose to spend their raise on parking, their compensation effectively stays the same. If they choose to walk, bicycle, carpool, or ride the bus to work, their parking cashout would translate to an actual raise.

When the idea was floated at a parking commission meeting last year, some commissioners had some qualms about the impact on the disability community. For those who don’t have the option of transportation alternatives due to their disabilities, they wouldn’t have the opportunity to get the touted benefit of the program.

Other transportation-related priorities were focussed on bicycling and pedestrian infrastructure, in particular sidewalks. Flaherty mentioned the idea of bonding to provide a significant increase in sidewalk improvements. Councilmember Kate Rosenbarger suggested bonding for pedestrian and bicycle infrastructure improvements, as part of an effort to tip the balance of financial investments towards non-motorized modes.

Councilmember Jim Sims said he agreed with supporting better multimodal infrastructure, because it fits with his three main points of interest: equity, wealth, and housing. Sims said he generally focussed on the revenue side of the equation. Sims put it this way at last year’s budget advance meeting: Everything that the council would like to spend money on represents a real cost to constituents.

Another specific idea, for a cut, came from Piedmont-Smith, who wants to eliminate the leaf pickup program, which costs around $800,000 annually. The topic got some discussion during last year’s budget hearings.

On Wednesday, Volan was less sanguine about eliminating the leaf pickup program, suggesting that the program could be improved and might be administered by a different department. The city utilities department has an interest in seeing leaves sucked up and out of the way, because it helps keep the storm drains from clogging.

Councilmember Dave Rollo focussed his budget priorities on expanding the local food economy. The COVID-19 pandemic has revealed how fragile much of the nation’s food supply chain is, Rollo said. A goal Rollo suggested was to provide 5 percent of our food locally, within the next two years.

Among the benefits Rollo gave for expanding the local food economy is local jobs. Buying locally-grown food recirculates wealth, he said, which creates a multiplier effect. Farmland that’s currently used for growing animal feed could be converted to growing food for people, Rollo said. Carbon emissions would be reduced, because less food would need to be shipped into Bloomington. Having a stronger local food economy would provide resiliency and security for the community, Rollo said.

One thought on “Mayor on 2021 Bloomington budget: “I do believe in a countercyclical government, so keep your ears open for that.”

Leave a Reply