Mayor Shirley Franklin is nearing the end of her eight-year tenure just as she began it, with Atlanta City Hall in sorry financial shape. This is a disappointing development from an urban chief executive once featured on the cover of Newsweek and ranked among America's top five mayors by Time.

Franklin has offered the Atlanta City Council a budget for the 2008-09 fiscal year that lays off employees, freezes vacant positions and raises property taxes to head off a $140 million shortfall. Her proposed tax hike will come on top of yet another anticipated increase in water/sewer rates. After six years in office, she presides over a budgeting process nearly as dysfunctional as that left behind by her criminal predecessor, Bill Campbell.

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The mayor is not to blame for all of the city's fiscal problems. The council has contributed a huge share to the dysfunction, and a recession has done the rest.

But Franklin took office amid high expectations, not just for higher ethical standards and inspired leadership — which she has shown — but also for more disciplined fiscal management. She was certainly not expected to preside over another budget meltdown.

For its part, the City Council has already begun harrumphing and hectoring over the mayor's budget, with some council members protesting the proposed tax hike — "I don't want to give up on trying to fight a property tax increase," said councilman Howard Shook — while others complained about the complexity — "This budget seems to be hinged on several policy changes we haven't even considered," said councilwoman Natalyn Archibong.

But a preceding City Council made a costly change that helped provoke this fiscal calamity, and some current members were on that body. Perhaps longtime members such as Clair Muller and C.T. Martin remember the vote: In 2001, the City Council made a dramatic improvement to the pensions offered to police officers, a colossal move that will haunt taxpayers for decades to come.

Troubled by low police morale and difficulty recruiting new officers, the council caved in to police demands for better benefits by increasing not just salaries but also the "multiplier" for pensions, from 2 percent to 3 percent. At the time, a police officer multiplied his years of service by two; he received that percentage of his salary as his pension. If he worked 20 years and his highest average salary was $50,000 a year, he'd get a pension of 40 percent, or $20,000. Now, the officer multiplies his years of service by three. So that $50,000 salary produces a pension of $30,000.

On top of that, federal regulations now require cities to set aside more money to cover pensions they'll have to pay out in years to come. Those pension burdens, plus soaring health care costs, have strained the city's finances, accounting for the shortfall and forcing dire choices.

But neither of those significant expenditures — pensions or health care — should have come as a surprise. Any accountant should have known that increased benefits would cost the city, and it's the accountant's job to know just when those bills would come due. Somebody was asleep at the switch and ought to be fired.

Atlanta residents are already struggling under the burden of a $4 billion overhaul of the city's ancient sewerage system. The overhaul is absolutely necessary, an ambitious but distinctly unglamorous undertaking that other mayors refused to take on. Franklin was courageous to do it.

But she has already hiked water/sewer rates 70 percent over the past five years, and she has proposed several more. If the council adopts them all, the average household's water bill will have jumped from $50 to $135 over 10 years, a 170 percent increase, according to Atlanta Journal-Constitution reporter D. L. Bennett. That's on top of the additional penny in sales tax charged on items purchased in the city.

Over the past decade, Atlanta has experienced a resurgence, with middle-class residents moving back inside the city limits, shops and restaurants opening and a new vitality energizing older neighborhoods. A property tax hike might not halt the city's momentum, but it sure will dampen residents' enthusiasm for its leadership.