Atlanta's City Council passed the city's $542 million budget for fiscal year 2013 after deliberations that featured none of the fireworks of last year, when contentious debates over pension reform dominated the headlines.
Atlanta's long-term projections indicate revenue in 2013 will be the lowest in a decade before slowly recovering.
"Our sense is that the property tax digest is bottoming out," Atlanta Mayor Kasim Reed said in an interview Monday. "We just want to stop dropping $15-20 million a year."
The budget does not call for tax increases or layoffs in the 2013 fiscal year, which begins July 1. Among the notable items:
- The city expects to have reserves of more than $110 million by the end of the fiscal year on June 30, up from $7.4 million when Reed took office in January 2010.
- Invest Atlanta, the city's economic development agency, will see its funding rise about one-third to $2.5 million, up from $1.9 million. It had originally asked for $3 million.
- The city will more than double arts grant funding for the Office of Cultural Affairs, adding $470,000.
- The city funded 41 additional police officers to reach a long-standing goal of 2,000.
Reed credited his top lieutenants for helping shepherd the 2013 budget though City Hall. It also didn't hurt that conversations about reducing health care costs for city employees have not been as controversial as the pension debate.
"This process was smooth largely because of the leadership team," Reed said. "This is our third time doing this now. The more you do it, you get better."
Ceasar C. Mitchell, president of the City Council, said the budget passed in record time.
"I think this is the first time we’ve passed this not in a specially-called meeting right at the end," he said.
Jim Hannan, chief executive of Georgia-Pacific, said the city has managed its finances well by adding reserves, propping up its pension and preserving important services.
"These are pretty good, delivered results," Hannan told a small group of reporters after a meeting of the Atlanta Committee for Progress, a coalition of executives from business, academia and philanthropies. "It puts you in the business of talking about the future ... rather than, ‘What's the next crisis?' "
As city officials hashed out the proposed budget in recent weeks, some City Council members pushed for higher pay for city employees. At one point, Councilman C.T. Martin recommended a 1-3 percent cost-of-living adjustment.
Employees "are the ones that make customer service work," Martin said in a May work session. "I don't want our employees to be living poor."
Martin and others singled out the Department of Public Works, which is responsible for picking up trash and cleaning streets, as a department that needed more support. Meanwhile, some council members said the city should share some of the savings from last year's pension revision with employees.
Reed said the city could not have afforded an across-the-board pay increase for its 7,500 employees. But using targeted raises, the city now aims to get every employee's pay up to at least 82 percent of the pay for similar work elsewhere. About 1,400 employees could see their pay increase under that plan.
"It's a signal that we are listening," Reed said Monday. "This will help us retain our talent set, but it's a fiscally conservative approach. We are very interested in attracting and retaining high-quality employees."
In the meantime, there is serious debate over how scarce resources should be allocated.
Next year, Atlanta will face a complicated situation in its public safety agencies. Federal funding for 50 police officers and 75 firefighters is going away, meaning the city will need to fund those positions itself or make cuts.
"A pretty significant amount of new head count," Reed acknowledged. "You've got to cover that."
Jim Daws, president of the Atlanta chapter of the International Association of Fire Fighters, argued Monday for a $1.2 million "pay step" to bring city firefighters' pay closer to the pay in other jurisdictions.
"We've been presented with studies that this (underpayment) has been going on for a decade," Daws told the City Council. "You understand that my members rightly feel they have been sold a bill of goods."
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