Jacksonville Mayor Alvin Brown, who throughout his first term has trumpeted his frugal stewardship of taxpayer dollars in the face of a nearly $2 billion pension liability and more than $2.5 billion in existing debt, is pushing a city spending plan next year that calls for borrowing $235 million.
That debt will pay for much of the marquee, headline-grabbing largesse in Brown’s 2014-15 budget — investing millions of dollars in downtown enhancements, a makeover of Five Points and millions more in road and park improvements.
The proposed borrowing, like other aspects of his budget, has come under quick scrutiny by the City Council’s influential finance committee for its eye-popping amount, the wisdom of investments Brown wants to tie the city to paying off over a long period of time and if he should add to a list of debt-financed projects that have yet to be finished.
Brown’s office defends the proposals and the mayor’s record as a responsible spender, saying that not all of the $235 million will be borrowed next year but over the course of several.
Chris Hand, Brown’s chief of staff, said the ambitious list of projects is a response to a sense the city has recently “under-invested” in several areas. And he said some council critics who slammed last year’s lean budget with a far more modest capital projects list “can’t have it both ways.”
Several council members have already said Brown’s plan is unworkable and express frustration they are now left with the unenviable task of cutting popular projects the city simply can’t afford.
“It’s going to be highly scrutinized, and it’s going to be lowered down,” Council President Clay Yarborough said of the debt-financed projects list.
“When you look over the list of proposed projects, there are a lot of good things in there. But it’s really putting the council in the posture of possibly appearing again as the big, mean City Council. We’re going to have to go through there and make responsible decisions for taxpayers,” he said.
Indeed, even as skepticism rears its head, council members, community groups and residents are happy with many of the proposed investments, which stand in stark contrast to the bare-bones budgets the mayor has pursued in his earlier years in office.
“You have stopped the downward spiral in funding that has plagued the library for nearly a decade,” reads a letter from Brenda Simmons-Hutchins, chairwoman of the city’s Library Board of Trustees. She sent the letter to Brown after learning that under his plan the system would get hundreds of thousands of dollars for extra equipment, extended hours and capital improvements.
While the mayor says he’s chosen investments that will grow the city’s tax base and improve Jacksonville’s quality of life, his critics see a more cynical motive.
“To me, it’s just so obvious it’s a political ploy,” said Councilman Bill Gulliford, a frequent and vocal Brown critic who has considered running against Brown. “This is about passing out goodies and lollipops and soliciting votes accordingly. You got to call it the way it is. The fourth year [of his term], it’s opening the floodgates.”
Many other projects, however, will also have champions.
The capital budget includes $200,000 for buying land at 13th Street and Moncrief Road, an area with a long history of drug sales and outdoor crime where Councilwoman Denise Lee has focused efforts on reducing what she calls “human blight” that she says makes the neighborhood less attractive and less safe for the community around it. The $200,000 is encouraging, said Paul Tutwiler, executive director of the Northwest Jacksonville Community Development Corp., who has worked for more than a decade to improve the neighborhood.
“We’re very mindful of the tight budget years,” he said.
The budget proposes borrowing the $235 million from the city’s banking fund, an account used to pay for capital items that are repaid over time.
Approving the budget would give Brown the authorization to borrow up to $235 million, though he does not plan to take out all the money next fiscal year. When the money is actually borrowed will depend on the individual project, Hand said.
For example, if a construction project requires a formal bid process that ultimately takes more than a year, the money for that project will be borrowed in the banking fund.
Brown argues the projects list represents “strategic investments” that can be paid for using historically low interest rates.
Not everyone is convinced.
Yarborough said giving the mayor the authorization means he won’t have to come back to the council to actually take on the debt in the future. And the $235 million “sets the stage for future tax increases.”
Council Auditor Kirk Sherman said the debt will ultimately cost a lot more than that top-line figure because the city will have to make long-term debt-service payments. Additionally, any construction projects will have recurring maintenance costs.
And, he said, even if all that money won’t get borrowed in the next year, it ideally will get borrowed “as soon as possible.”
“We are going to indeed do these projects over the next few years and complete them,” he said.
The prudence of some of Brown’s proposed investments is also under scrutiny.
He wants to use $34 million in borrowed money to replace the city’s aging vehicles, which skeptics say would tie the city up with years-long debt payments that will likely last longer than the vehicles purchased. City rules prohibit using the banking fund for expenses under $50,000; the proposed budget includes a waiver for that rule so vehicles could be bought.
Hand said the vehicle replacement proposal is in line with a recommendation from a budget analysis committee, which Yarborough chaired earlier this year, that issued a recommendation saying the council should “consider appropriating funding to replace outdated equipment and vehicles along with providing training dollars for operators.”
Councilwoman Lori Boyer wants to ensure the projects the council wants to get funded don’t fall through the cracks.
She’s long been concerned over a backlog of projects the council has authorized in prior years but that have never been funded with debt from the banking fund.
A special committee she chaired — tasked with examining the city’s consolidated government — investigated that issue and received a list showing about $168 million of authorized debt that had never been used for projects stretching back to 2009.
David DeCamp, Brown’s spokesman, said that list is a draft and should be taken with several caveats.
In some cases, for example, the full amount of money for a specific project may have not yet been issued because it hasn’t yet required it. In addition, the list doesn’t take recent actions on the budget and proposed capital list into account.
Still, Boyer knows of projects in her own district the council approved funding for but have never started, and she suspects the same is true in other districts.
Sherman said the city has been slow to close out projects in the banking fund, which has been a source of angst among council members.
“It seems like it takes forever to close out a project. … Meanwhile, new ones are coming up,” he said.
One valid question, Sherman said, is, “If we can’t handle what’s on our plate now, why put more on it?”
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