The City of Des Moines is facing a "potential shortfall of $3.6 million in the 2005 budget".
The main sources of the shortfall are the cumulative effects of past initiatives (I-695 and I-747 reduced City revenue by approximately $2.5 million) along with local economic conditions and a potential additional $659,000 shortfall that would result if Initiative 864, the property tax rollback measure, gathers sufficient signatures to qualify for the November general election and is approved by the voters.Subtext: It's all Tim Eyman's fault! But I-695 was declared unconstitutional, so it couldn't have had much to do with the shortfall. The other thing the careful reader will notice is that expenditures are also expected to go up by $1.5 million from $13,268,000 in 2003 to $14,753,000 in 2004.
I don't know much more than this. But those who live and pay taxes in Des Moines might want to attend one of the upcoming community budget meetings
hat tip: Mike Christianson
Posted by Stefan Sharkansky at August 10, 2004 12:35 PM | Email ThisDes Moines was on the receiving end of sales tax equalization funds - money given to communities that are at less than 70% of the statewide average of sales tax collections. This "equalization" was paid out of motor vehicle excise tax (MVET) monies. [Don't ask me why the State paid sales tax replacement money out of anything other than sales tax revenues, but they did.] While I-695 was overturned, the Legislature wound up voting to repeal the MVET anyway. Des Moines lost $2 million due to that action.
Passage of the property tax proposal guaranteed that Des Moines could collect no more than 1% more than the previous year, without voter approval. The 1% is less than the rate of inflation, and passed after collective bargaining agreements had been signed with the police guild and other employees for an inflationary increase. The net effect was an additional $1 million gap between revenues and expenditures.
While I have been a strong advocate for Des Moines reducing its expenditures to reflect the reduction in revenues, I challenge anyone to cut their income by 25% and not have to cut basic services.
Posted by: Dave Kaplan on December 22, 2004 01:45 PM