Last night, new Wilmington Mayor Mike Purzycki released his first budget with an address that both laid out the fiscal challenges and laid out a vision. As expected, the fiscal challenges are serious. The City is $14M in the red, which is paid for from the city’s reserve fund. It is effectively wiped out by this deficit. The City’s budget process this year was done on a four-year basis, which often lets you see the effects of a single year’s spending and revenue generation in out years. This approach lets you plot the effects of long-term policy implementation as well as a way to develop some standard performance measurements. The risk of this approach is the notorious difficulty in projecting financial performance more than a year out. Still.
The deficit left by the previous Administration comes mainly from:
- $6.7 million in employee raises
- Minimum of $6.5 million for workers compensation claims from the firefighters injured in the Canby Park fire — the City was self-insured with no self-insured reserve
- Budget overruns for police and fire overtime
Add to that a projected increase of $1.2M in employee health care costs this year, a loss of $1.4M in red light camera revenue (PLUS $800K refund to those wrongly ticketed) and a projected decrease in the City wage tax of $3M (as projected by WEFAC).
To address this, Purzycki proposes to:
- Raise property taxes by %7.5 in 2018
- Increase Water/Sewer rates by 4%
- Eliminate 29 currently vacant positions — including 16 firefighter and 5 WPD positions
- Revisit employee contracts — he wants to get more efficiency from city employees theoretically making it easier for managers to ensure that they can deploy staff as needed. He also wants to revisit employee health care participation — asking employees to pay more for their insurance and co-pays. The proposal is to bring this in line with the State health care system. It also sounded like he wanted more of a focus on employee wellness.
- Implement some additional cost saving programs from disposal at Cherry Island , from animal control and refinancing current debt.
Current vision I would describe this way:
- Do the work to eliminate Wilmington’s structural deficits and stop the yearly bleeding so that the city can turn to longer term investments
- Start setting up methods to set and measure performance targets for all departments
- Implement a pilot Neighborhood Revitalization program:
Soon, I intend to announce a section of our city as the first of the Neighborhood Stabilization projects. This will serve as a model for how a concentration of resources from city agencies and state agencies can, together, transform our neighborhoods. Police, Public works, License and Inspections, Parks and Recreation and Housing will work with the new Land Bank and state housing agencies to leverage our funding into renewal for impoverished sections of Wilmington. At the same time, state agencies will provide wrap‐around supports for many of our fragile young people in these areas, fulfilling the recommendations of the CDC report championed by Council President Shabazz.
- A Clean Streets program — where major roadways are cleaned regularly
- Focus on Public Safety with a new Chief at the helm
- Work to find jobs for residents
- Lobby for Wilmington to more fully govern itself:
- This is a good time to state what should be a guiding principle of our argument for the right of self‐governance. Wilmington cannot be expected to govern itself when it is constrained at every turn from doing so by the state. It never had the right of annexation so that it might have, at one time, grown organically. It had its residency requirements dictated by state legislation. As previously stated, the legislature last year dictated to us our inability to fine illegal right turns. We are prohibited from raising revenue from any major source other than the property tax. And, Wilmington has been all but shut out of the important question of how our children get educated. We must all urge our legislature to empower Wilmington to govern itself.
There’s a lot going on in this budget, and I think that much of it will get lost in what is likely to be a pretty vocal pushback on the vacancy cuts, re-implementation of the rolling blackouts and the revisit of the employee contracts. But here are my takeaways:
- Purzycki’s campaign was focused on more development in and investment in Wilmington. Given all of that focus, there isn’t as much of that here, with the exception of the Neighborhood Stabilization program. Maybe this program is bigger. But it is tough to see what we’ll be able to do financially to support additional private investment in the city. So this seems to be a pull back based on the reality of the city budget — and this first year is all about stabilization of the fiscal picture, stabilization of fiscal accountability, establishing performance metrics and focusing on improving public safety.
- City employees are going to be asked for greater efficiency and greater productivity. They are also going to be asked for more contribution to their health care. This will be interesting to watch given that City employees are not paid on the same scale as State employees. But I watched some City employees cheer the “Businessman” Mayor and it will be very interesting to see their reaction to being asked to live with employment expectations similar to that asked for private sector employees.
- Beyond stabilizing the budget and budget process, the most impactful thing for Wilmington would be for the GA to let go the tight box they make Wilmington live in. It is pretty senseless to have your biggest city constrained by a state legislature that is having a tough time managing the state, much less Wilmington. I’d have to think through some of the larger ramifications of this, but letting Wilmington be accountable for itself seems like a good idea.
Did you watch the address? What did you think about this?