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Tulsa is facing its largest sales tax decline in city history. Here (briefly) is how city government is working to cut back and move forward.
Signs of Tulsa’s financial struggle are everywhere, from un-mown grass to graffiti accumulating around town. Reducing services, eliminating hundreds of positions and instating furlough days have lightened the city’s budget, but the consistent decline in sales tax revenue has had a significant impact.
“It’s stronger than anything I’ve experienced and the largest decline that the city has experienced, and we’re not done with it yet,” says Mike Kier, City of Tulsa finance director.
Out of 16 months of declines, May was the only month with an increase.
“Rewriting the budgets for the last year has been a challenge for the city and the people employed by it,” Kier says.
The total budget for fiscal year 2010-11 is $555.4 million, a decrease of $13.5 million.
Mayor Dewey Bartlett and the Tulsa City Council have identified ways to boost revenue, such as increasing water and sewer fees, using last year’s budget surplus to fund services and using the trash reserve fund for graffiti abatement and mowing, although not all of these ideas have been approved.
“Taking money from last year to provide services — that’s one approach,” Kier says. “We’ve done a lot of different things to address the revenue situation. Officers are paid out of a federal grant through 2011, but then (we) will be out of funds.
“We have a number of items like that, where we make use of grants, such as in the transit area.
“Tulsa Transit’s $2 million in grants will exhaust next fiscal year and the city will have to either resume sending revenue or reduce the service.”
Restoring services such as graffiti abatement and opening city pools is important, Kier says.
“When you look at communities where graffiti is allowed, it leads to deterioration in the neighborhood and the environment, and other problems circle around it,” he says. “The pools were operated last summer, but we knew there were no funds to operate pools this summer.”
Community donations made opening the McClure, Berry, Whiteside, Reed and Lacy pools possible.
As of press time, the Tulsa City Council and Bartlett were discussing various budget amendments, including restoring highway lighting, reducing furlough days, reinstating fire department salaries and increasing funds for street and pothole repairs, among others.
Additionally, KPMG, an international consulting firm, reviewed city operations.
The KPMG study focused on city services and managers over a period of 16 weeks, wrapping up July 1.
“The purpose of the strategic review was to improve the efficiency of city operations and identify opportunities to save money,” says Cathy Criswell, chief risk officer in the Mayor’s Office.
The city chose the firm because KPMG partner Bridget Anderson is well known for conducting city reviews, Criswell says.
“Ms. Anderson led a similar project for the city of Indianapolis, which is a leader in efficiently managed municipal government,” she says.
The Tulsa Community Foundation stepped up to finance the study.
The process began by preparing an inventory of city services with the assistance of city managers. Once the services were identified, the managers calculated costs and identified any relevant revenues for each service. The managers completed surveys for each service that provided information about its efficiency. The information helped to identify improvement opportunities, such as changes in work assignments and organizational structure.
“The mayor plans to have employees involved in preparing action plans to address results from this project,” Criswell says.
In the meantime, estimates show that sales tax revenues will remain negative for most of the year, Kier says.
“From what we’re seeing now, it looks like we’re approaching the bottom point,” he says. “But it’s hard to know when.”
