Friday, November 08, 2013

EDITORIAL >> City is facing fiscal crunch

Jacksonville is facing its most serious financial challenges in decades. Mayor Gary Fletcher this week informed the city council that $2.95 million will have to be cut from next year’s budget.

All city departments are likely to take a hit, which will almost certainly affect services to residents.

The financial problems have been spurred on by a weak economy and poor census results that cut $1 million in federal turnback money for Jacksonville in 2011. That hurt. Also, the mayor is determined to make much-needed improvements, though those ambitions have stretched the city’s budget ever since he took office in 2009.

An expensive police- and fire-training facility, a new police department, a beautification project on Main and James streets, and now the new sports-shooting facility on Graham Road — all are valuable upgrades, but perhaps they could have been completed decades ago when the city was doing better economically.

Did the scope, scale and timing of these projects wreak havoc on the city’s finances? Simply put: too much, too soon, but you can’t fault the mayor for an ambitious agenda, including a $3 million shooting range on Graham Road, although the Arkansas Game and Fish Foundation is paying two-thirds of the cost. Good for them and us.

For the last two years, Jacksonville has used its reserves to avoid cutting budgets of the various city departments. Officials had hoped to rely on the city’s coffers temporarily and see a boost in sales-tax receipts. But tax collections are flat, and it’s uncertain if those will pick up pace.

Fletcher told the city council Thursday, “We’ve got to tighten our belts up….We’re going to have to bite the bullet here to get a hold on it. You (the aldermen) are going to have to learn to say no…This is the ugly part of being an elected official.”

One option to address the shortfall is taking a 10-year bond issue to voters. Fletcher said the bond would not be a new tax but would restructure the city’s debts into smaller monthly obligations and free up cash flow.

During a recent Jacksonville Advertising and Promotion Commission meeting, its members considered auditing restaurants and hotels because they suspect business owners are shortchanging the city on hamburger tax. (That’s the two-cent sales tax on prepared foods and hotel rooms.) The commission’s options on how it spends those funds are limited to city festivals, other cultural events and advertising. Much of the hamburger-tax revenue is given to the Sells Agency, a Little Rock-based public-relations firm, which uses its $150,000 annual contract to purchase a handful of TV commercials and a few billboards.

In a concession, after the contract was criticized in these pages, the A&P commission proposed giving the Sells Agency $100,000 next year. That’s still a big waste of money.

No other city in The Leader’s coverage area employs a public-relations firm, especially since local chambers of commerce should promote their own cities without outside help.

Money collected in Jacksonville should be spent here. Providing substantial funding for the new city festival would be a start. The A&P commission plans to give Festiville only $20,000 next year.

Next year, the A&P will have $880,700 to spend. It saved $230,000 to help pay for the shooting facility and will pitch in another $180,00 next year. That will be a shot in the arm for the local economy as thousands of shooting enthusiasts are expected to attend tournaments here starting next year.

City council members, who are mostly quiet during their meetings, need to start inquiring about budget planning and the necessity of some of the city’s expenses. Mayor Fletcher, who was an outspoken alderman for decades, cannot improve the city without an inquisitive and vocal council to guide him.

The city council also needs to emphasize that, while budgets are being slashed, the mayor should cancel the contract with Rickey Hayes, an Oklahoma-based economic-development consultant who has yet to bring a major business to Jacksonville. The mayor has mostly ignored critics of Hayes’ contract and has apparently decided to continue the deal despite the budget shortfalls.

If restaurants and hotel owners are going to be audited by the city because of suspicions and rumors about their supposed dishonesty, officials must demonstrate that they will spend that money wisely.

It won’t be easy, but the city can balance the budget while making improvements. First, city council members must show an interest by asking questions, taking a position and planning for the future. They can start now by balancing the budget.