The Do-Nothings

Bill Stipp says he is “proud” of what he and the other seven dwarfs have done managing Goodyear’s budget. He’s bragging about it. Bill Stipp is either a consumate politician who does not want to be confused with the facts, or he simply does not know what he is talking about.

Interim GY City Manager Brian Dalke tells you in an opinion piece (that he had time to write for the Arizona Republic on your dime) that GY has had to make tough budget decisions but not to worry, things are looking up, and soon an improved economy (and more of your property tax revenues) will solve everything. In Brian’s 2013 GY budget, your property tax increase he says is, “only 54 cents per month”. Brian tells you that it’s the state’s fault your property taxes are going up because they are shifting property tax burdens from commercial to residential. Of course, Brian doesn’t supply any data to support these claims nor any of his other positions. Dalke has said previously that he had to increase GY employee salaries this year by over $1 million dollars per year because of his fear of high turnover and losing good people. But did Brian provide any data to support an inordinate turnover rate in Goodyear (besides all the fired GY employees who are either suing or got big payoffs like Fishcbach)? Nope, once again, no data. It’s easy to flap your mouth with no data.

The facts are, as I demonstrate below, that since 2008 when the recession started, Goodyear has done absolutely nothing to soften the impact of the recession for it’s residents.

Budget, Budget, Budget

Budget, that’s all that Stipp and Dalke want to talk about. As I’ve told you before FORGET ABOUT BUDGETS. The fact that politicians only want to talk about budgets is your first clue that you should ignore them. Budgets are just estimates. Just like GY council is telling you that they plan to set aside $700,000 per year to pay down the ball park. That’s only a plan. What if Georgia wants another new $80,000 per year assistant next year? What happens to the plan then?

If you want to predict future behavior, the best way is to look at past behavior. In this case, look at actual historical SPENDING and actual historical REVENUES to determine if your elected officials have actually done anything worthwhile for you and if they have been good stewards of your money in Goodyear or anywhere else.

Here Are the Facts. An Historical Look at Goodyear’s ACTUAL Finances

Goodyear’s problems started in 2008 with the recession. That’s when your financial problems may have started too. When you had to tighten your belts at home. Has Goodyear tightened its belt?

Refer to the table below and the raw data that I have included at the end of this article if you want to check any of my numbers.

Since 2008 through the currently proposed 2013 budget, Goodyear has;

  1. Seen General Fund revenues drop 17%.
  2. Increased Operating Department spending by 11%
  3. Reduced the General Fund Beginning Balance by 63%
  4. Increased water, waste water, and sanitary revenue fees by 44%

A good way to look at any complicated financial data is to use difference analysis. That is, look at each year of data and compare it to the previous or following year in order to see what ACTUAL changes have been made. If the stewards of your money have done their jobs and been responsive to the ebb and flow of revenues, then they’ve done something for you. Looking only at year over year differences removes any issues around whether or not the data is valid and omits any question of looking at apples to apples comparisons.

On the other hand, if someone trys to spin a complex financial issue into a cheap talking point like, “it will only cost you 54 cents per month”, watch out.

In a simple difference analysis like the table above, (and here it is if you want to see it in Excell GY Operating Analysis 08-13) you are just comparing what was reported historically from one year to the other. It looks at how ACTUAL Goodyear spending changed each year vs ACTUAL Goodyear revenue changes each year. And to keep it simple and to the point, in this analysis, I am completely ignoring capital spending and financing like going out and borrowing money in order to keep the ship afloat. I am only looking at operating expenditures and operating revenues.

As you can see from the table, in 2008, Goodyear had $12.8 million dollars more in General Fund revenue than it had operating expenses, or one could say GY ran a nearly $13 million surplus that year. In 2009, revenues dropped by over $18 million. What did expenses do? They went UP by nearly $8 million dollars. These are actual, real numbers, not budget estimates. That left Goodyear a net deficit in 2009 of more than $13 million, more than wiping out 2008’s surplus.

If you carry this same analysis out to the current proposed 2013 proposed budget, in the five year period starting in 2008, Goodyear has run a $33.23 million dollar net deficit over this time period (yellow highlighted). Revenues have dropped from over $82 million in 2008 to less than $60 million in 2011 and GY estimates revenues to be only $68.7 million next year. At the same time, operating departments expenses have increased from $69.7 million in 2008 to over $77 million in the 2013 budget. Does that look like belt tightening to you? Goodyear has failed to respond with spending reductions to balance changes in revenue and fallen behind on an operating basis by over $33.23 million dollars over the 5 year period since 2008.

If Goodyear has failed to respond to the precipitous drop in revenues by reducing spending, then where did GY get the money to keep operating in what Brian wants you to believe have been “balanced” budgets? The answer is first, they’ve raised your utilities bills and second, they’ve raided the cookie jar of General Fund surpluses that your tax dollars had built up by 2008. Again, looking at the table above you can see that over the same period, using actual historical data from Goodyear’s own budget book that;

  1. Water Utilities bills to residents have been increased by $3.62 million dollars.
  2. Waste water bills to residents have been increased by $4.32 million dollars.
  3. Sanitation bills to residents have been increased by $1.01 million dollars with a drop in service levels.
  4. For a total of increased billings to residents of $8.95 million dollars or 44%. (pink highlighted)
  5. And did I mention that $2.8 million of that is coming in the 2013 budget? Here is their own document showing $2.8 million in transfers from the three utilities to the General Fund. Transfers to GF0001

The rest of the cash has come from draining the General Fund Beginning Balance each year. In 2008 the GF Begin Balance was nearly $56 million dollars. Today it is just over $20 million dollars. (blue highlighted)

So what tough decisions have GY council made to steward your money? They’ve done nothing. Nothing but raise your taxes and fees over the past five years and drain the treasury. This has allowed them to take junkets to DC, hire expensive assistants, make $450 per second videos, give tax breaks to foreign corporations, make bets with your tax money on emerging technology gambles, and increase city employee salaries and benefits.

Bill Stipp is “proud” of that.

*As usual, hgb includes links to all of the raw data for you to see and here they are;
Budget Book References 2013 Budget Documents from Cof GY0001


7 Responses

  1. Don’t let the “General Fund Beginning Balance” fool you. That is under control of Finance. In general, all operating accounts are “use it or lose it”, as in if there is money in the account at the end of the fiscal year, it is swept by Finance and they do “something” with it. But departments are not allowed to carry over remaining funds.

    Also, FY 2008 is a bad example year, which was 2007-2008. In early 2008, a hiring freeze went into effect and significant cuts were made to operating budgets. The money wasn’t taken away, but the order was given not to spend it. That is the reason for the large budget surplus in FY 2008.

    Yes, water/wastewater utility fees have gone through the roof. I believe those increases were passed in FY2009 and phased. I don’t believe Sanitation has had a fee increase. Increased revenue does not equal increased fees. An increase or decrease in customers can skew the numbers. No doubt, fees for water services have increased.

  2. Howard this is all great stuff but the rabid supporters of the council members (especially those council members living here in PebbleCreek) have been very successful in villianizing you and anyone else who posts in opposition to council actions. Just check out the comments on AZ central. Anyone reading those trashy comments would be too intimidated to ever run for council. I have heard rumors that it is the council members themselves posting that trash but who knows? Who ever it is they are certainly relatives or close friends of the council members because people not intimatically connected to them would not take the time to write such nasty trash. Just today in the Republic they ran a story about Goodyear’s budget that was so slanted in favor of the council it was sickening. The council has both John Yantis and Jim Painter in their hip pocket. Not to mention having most of the folks living here in Pebbles completely snowed which is truly amazing. I think it is all about being able to say the Mayor lives here and it makes people feel special especially if Georgia, Wally or the Gelz say “hello” to them.

    • What you mention is a good reason why the City should be divided into council districts, which was to happen I believe when the city passed 60,000 people. It was pushed back to a higher population threshold. All but one council member lives north of I-10. Only one lives west of Cotton Lane, same one south of I-10.

    • Gyw, why don’t you start writing to Painter and AZ rep and tell them their work is biased?
      If they get enough complaints they might change.
      What I think it is, though, is that they report whatever the city tells them and the city slants it. In reality, the city’s information person is the one writing the articles for WVV and AZ Rep.

      I think the folks writing nasty stuff are the same people who have been supporting council folks all these years and don’t want to lose their bought and paid for advocates. Check the election finance contributors for a complete list.

      • Yes you may be right about the folks in PebbleCreek not wanting to lose their power. But the handwriting is on the wall. Lots of the really old timers in Pebbles on the nest side are going home (and I don’t mean to MN) and I don’t see much new contstruction going on in Pebbles. It looks like as the city increases in size the younger families will begin to take over and their mindset and vote may be a lot different than the crowd who likes the status quo behind the gates of Pebbles. The warehouse, solar and refrigerator plant assembly workers and their families will more than likely have much different ideas for Goodyear than the older generation running Goodyear now. It is funny that the very people that Goodyear City Council is attracting by providing their employers with corporate welfare funds will in the next several years be the people who drive the folks living here in PebbleCreek out of power. As I look around Goodyear I see the demographics of the people living here changing more and more every day with the exception of Pebbles which still looks like the tea party crowd. Mr Koch—at that point they will be leading the charge for districts so they can at least have one representative!

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