Tuesday, June 22, 2010

Deep thoughts on Greensboro’s budget and Guilford County’s economy, by John Hammer and Donald Patterson

" 'Fiscal Conservatives' Increase City Budget

…it is hard to find any standard by which the 2010-2011 budget is more fiscally conservative than the current 2009-2010 budget…

…The fiscal 2010-2011 budget…reduces the tax rate by one-quarter of one percent, but raises water and sewer rates by 6 percent.

…the $423 million budget is $1 million higher than the 2009-2010 budget…

The City of Greensboro is going to receive less revenue
and spend $1 million more than last year?

…Two weeks ago [Danny] Thompson was bragging about cutting 2 percent, or about $8 million, from the budget… It was big talk, and when all the cutting was done, nothing of note was cut, while the City Council added $100,000 for the Greensboro Children's Museum and put back nearly all the service cuts that Young had proposed to balance the budget.

What the council did do was spend down some of the multitude of fund balances that the city has, which allowed them to cut the 0.1 percent from the proposed budget without cutting services, programs or personnel.

Is Greensboro about to borrow $40 million,
spend reserves to increase unneeded spending
while simultaneously cut taxes and raise water rates?

…When fiscal conservatism ran headlong into pork barrel spending in the City Council budget, pork barrel spending came out ahead."

John Hammer
Rhino Times

"Region slow to recover from recession

Two-and-a-half years after the beginning of the Great Recession, the economic recovery in the Greensboro-High Point metro area remains short on jobs and appears more fragile than ever.

…the recession locally has been more severe and the subsequent recovery weaker than in the three previous recessions dating to 1981.

…the Greensboro area suffered two blows — a further decline in employment and a significant dip in the growth of goods and services.

…Data show that employment in the region dropped one-tenth of a percent in the fourth quarter of 2009, but fell four-tenths of a percent in the first quarter of 2010.

Output, called gross metro product, grew by 2.2 percent in the fourth quarter, but expanded by only nine-tenths of a percent in the first quarter.

…The region’s unemployment rate at the end of March hit 11.6 percent, putting Greensboro-High Point in the bottom quarter among the 100 largest metro areas.

Others say the growth in the economy hasn’t been sufficient to help the employment picture and may not any time soon.

“There are questions about whether the growth we have had is sustainable,” said John Quinterno, a principal with South by North Strategies…“ ...We are right now in a kind of stalled economy.”

Do Greensboro and Guilford County’s 2010/11 budgets
rest on “unsustainable” economic assumptions
and savings spent right before they may really be needed?

...Quinterno fears the state could be in for “another rough patch” later in the year.

The reason? Many federal programs designed to boost the economy are ending, and “it is unclear what will take their place.”

Right after we wasted our reserves on non-essential spending?

Donald Patterson
Greensboro News and Record

George Hartzman

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