Put the Mayor on Diet

How much is the Mayor willing to sacrifice in order to balance the budget? Looks like 1/20 as much as the City Council and 1/2 as much as he expects of city employees. The City Council voted to reduce their salaries by 50 percent. The Mayor has proposed reducing City employee salaries by 5 percent. So how about his salary? He proposed a 2.5 percent cut.

The Mayor could easily reduce his salary to historical levels, especially given the current economic problems.

The Mayor must explain why he needs a $74,000 a year salary for a community of 21,370 when Meridian's Mayor is paid $70,000 a year for a city of 75,290. On a per capita basis, Mayor Bandy's salary is 272 percent higher than the Mayor of Meridian. Remember, as a City Councilman, Bandy voted to increase the Mayor's salary from $42,000. He then announced his candidacy the following week.

He is claiming that it would require passing a new a complex ordinance. He could call an emergency session like he did when he got his $500,000 loan in December. He could suspend the rules like he did when the Council voted to raise the Mayor's salary. Of course he could always simply donate a portion of this salary back to the City.

Many have suggested that $50,000 is reasonable. He could keep his generous $23,000 benefits package, netting him $73,000 a year in compensation.

The Mayor's office revised 08-09 budget was $118,631. He is now proposing a 27 percent increase up to $151,055. Last year the Mayor hired a full-time assistant. When the economy turned sour, he shared her with three other city departments. She spent 25 percent of her time working for the Mayor. He now wants her back to work for him full time. The taxpayers and the three city departments must sacrifice so the Mayor can have a full-time re-election campaign worker.

Of the Mayor wants respect and trust, he must get real with his salary and office budget. A commitment to reducing his salary to $50,000 a year and a promise to avoid TAN loans would go a long way to inspire public confidence.

Bandy to Cut Hours and Raise Rates

Last year Mayor Bandy spent $22,250 of our tax money on a flawed
compensation study. Using the defective study as decoy, he increased the
salaries of many city employees in the middle of a recession and
declining tax revenues.

He is now proposing a reduction in salary costs. Good idea. But instead
of reducing the wage rates to 2008 levels, he plans on reducing hours by
five percent. This is like telling you your car will get better mileage
if you drive it less. The effective cost of city government will
actually increase, since city employee medical and dental insurance
benefits will not be reduced. We get less service at a higher price.

Here's an idea: In his recent budget proposal, the Mayor has promised to
get the City out of debt and have $700,000 in reserves by October 1,
2010. To guarantee he is serious, he should cut his salary back to the
$42,000 it was when he was elected until his promises are fulfilled.
This should quickly incentivize the Mayor to stop overspending.

The Mayor said he won't raise property taxes. Really? According to his
assistant, his budget proposes a 4.1 percent increase in property taxes.
How is this possible when homes in some Eagle neighborhoods have fallen
33 percent in value and vacant lots have fallen up to 75 percent? In
2008 Mayor Bandy raised the levy rate 5.7 percent from the previous year
when no one was watching.

The Mayor is playing a game with rates and revenues. Property taxes are
based on assessed value multiplied times the levy rate. So if your house
falls in value, why are your property taxes still the same? Either the
assessor has not reduced your assessed value, or the city has raised the
levy rate, or a combination of both.

In order to keep the total amount of property taxes from falling, the
Mayor may resort to increasing the levy rate again. This way, he can
claim that he hasn't raised your property taxes. To get the same
property tax revenue from a property that has lost 33 percent in value,
the levy rate must be increased by 50 percent. We need the Mayor to be
honest on property taxes and promise not raise the levy rate.

This would be like Butch Otter facing a decline in sales tax revenue due
to falling retail sales deciding to raise the sales tax rate from 6
percent to 9 percent and then claiming that he didn't raise taxes
because the total revenue from sales taxes hasn't increased.

We still have a long way to get Eagle back on sound financial footing.
An open and clear discussion from the Mayor on the difference between
rates and revenues would be helpful.

For now the Mayor needs to promise not to raise the property tax levy
rate.

Stop the $500,000 Bandy Sneak-A-Tax

Last August the City of Eagle held public meeting to discuss the
proposed FY09 Budget. At that time Councilman Al Shoushtarian
suggested that revenues were going to be dramatically lower than Mayor
Bandy anticipated. Mr. Shoushtarian also presented a budget that
adjusted expenditures. Both the forecast and alternative budget
proposal were greeted with ridicule and silence by the Mayor and other
council members.

Now that Mr. Shoushtarian's revenue predictions have come true, Mayor
Bandy wants to borrow $500,000 so he can keep spending. While this
loan is technically short-term, if it cannot be paid off within a year
it becomes long-term debt. This effectively means that the Mayor can
circumvent the Idaho Constitution and go into debt without a
two-thirds approval of the taxpayers.

Unless the Mayor dramatically reduces spending, he will be forced to
borrow even more to cover his deficits. The City's 2009 general fund
spending budget is over $7 million. Revenues last year were only $5
million. Does anybody think this year will be better? If we don't stop
Bandy's out-of-control spending and borrowing Eagle will end the
fiscal year drowning with over $2 million in new debt.

Mayor Bandy and the City Council need to lock themselves in a room and
not come out until they have a budget that reflects the current
economic realities. If they do not have the courage and competence to
perform this operation, they need to step aside and let responsible
adults take charge.

Taxpayers have the opportunity on February 17th at City Hall to
express their opinion regarding the new debt the City is incurring.

If you cannot attend the meeting, you may also submit a letter to the
City Clerk/Treasurer Sharon K. Bergmann at P.O. Box 1520, Eagle, ID
83616 and request that it be read into the official record at the hearing.

You may also want to call or email the Mayor and member of the City
Council and ask them to get serious about being fiscally responsible.

Mayor Bandy can be reached at 939-6813.

Remember, Phil wants to spend this money, but he wants you and I to
pay it back.

Who’s Going to Bail Out the City of Eagle?

The City of Eagle hopes to avoid bankruptcy by borrowing $500,000 to cover its current operating expenses. According to their FY08 financial report published in the Valley Times last week, the City expected to have $7,844,117 in revenue for the general fund. The actual revenue was only $5,048,487. So did the City adjust its spending to balance the budget? Afraid not. The City reports spending $6,882,455, or $1,833,968 more than they had in revenues. How did they do this? Instead of tightening the belt, the City dipped into the taxpayers’ savings accounts. The City started FY08 with $1,848,872 in carry over savings and reserves. It looks like this has now evaporated with last year’s overspending.

Given this history of irresponsible spending, should the Mayor really be trusted with our credit card? The City’s FY09 general fund spending budget is over $7 million. If revenues last year were only $5 million, and this year may be worse than last, where is the $2 million difference going to come from? The Mayor intends to use the city credit card and borrow $500,000 to start covering the shortfall.

Like GM, Eagle city government suffers from too many unproductive employees being paid salaries that are way above market. Why can’t the City just simply put itself on a spending diet like most of Eagle’s families are doing? The City leases an extravagant City Hall building for an exorbitant rate. Councilman Al Shoushtarian tried to warn the Mayor of this impending fiscal problem, but was dismissed with arrogance and insults.

Mayor Bandy has refused to make responsible spending reductions. To avoid insolvency, the City must cut the spending budget by at least 35 percent immediately. Governor Otter and many other public leaders have recognized the economic realities and have made the necessary budget reductions.

Instead of making necessary reductions, the Mayor wants to put the taxpayers into more bondage with new debt. Perhaps he is expecting a trickle-down bailout from the U.S. Treasury or that the Federal Reserve will authorize him to start minting new Eagle dollars made of lead and empty promises. In the mean time, we need to take back our credit card. No more midnight spending and giving the citizens the bill the morning after. And most importantly, no new debt without a vote of the taxpayers.

Eagle Salary Report Gets a D-

The City of Eagle recently spent $22,250 for a study to determine if its employees were being paid enough. Mayor Bandy frequently referred to this report in arguing for increasing city employee's salaries. However, he refused to release the full report to the public. The City Council ultimately had to vote to require the study to be made available. Surprise,surprise! The study suggests that several employees are dramatically overpaid.

Perhaps the much deeper problem with the report is the selection of comparable cities. Should the City of Eagle be compared to the City of Boise? Boise population is around nine times larger than Eagle. This would be like comparing a 2,000 square foot house to an 18,000 square foot house. Using Boise as a comparable might make sense if the salaries were first adjusted for population differences. This adjustment was not done in the Mercer report. The report also used Meridian and Nampa without making size adjustments. By using cities much larger than Eagle, and failing to make size difference adjustments, the conclusions are not credible. A regression analysis showing the relationship of salaries and population should have been used to establish the basis for making location adjustments.

If the comparable cities are adjusted for population size, the results are much different. For example, the Eagle P&Z Director is paid $82,500. The population-adjusted survey average is $56,145. This suggests 47% above the market. The Eagle City Clerk is paid $72,646. The population-adjusted survey average is $49,500. This also suggests 47% above the market.

The Mayor should ask the Mercer Group to refund the $22,250. Or, ask them to go back and pick cities that are more comparable in size, make adjustments for population differences, and see what the revised findings suggest. I'll bet a penny that more City of Eagle employees are found to be overpaid.

A simple way to test if Eagle city employee salaries are too low: Why haven't any city employees left for higher salaries in other similar-sized communities?

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