Charleston Mayor Joe Riley was serving bad news this time last year, offering a city budget that covered expenses by spending more than $2 million in a rainy-day fund. "It may be that the budget for next year will be just as challenging," Riley told council members.
This year, he made good on that statement. The new $146.6 million budget includes a decrease in city spending, a continued hiring freeze, and a furlough for some holidays.
"This budget is made possible by the sacrifices of every city employee," Riley says of the 2010 budget.
But city employees aren't the only ones feeling a pinch — city residents dodged a tax increase, but the city hiked fees on SCE&G — a move you're almost certain to see in your power bill beginning in 2011.
City Council gave initial approval to the budget last week in an 8-3 vote, and is likely to give final approval this week. Fortunately, there's a light at the end of the tunnel. Riley suggested things are looking up for 2011.
Council members were excited to offer a budget without a tax increase, but some opposed the plan due to the increased franchise fee for gas and electricity provider SCE&G — from 3 percent to 5 percent. The new rate would match or at least stay in the ballpark with neighboring municipalities, but Councilman Gary White and others note it's a charge that would inevitably be handed down to consumers.
"I'm fearful that in raising the franchise fee, we're only increasing the cost for consumers," he says.
According to Steve Bedard, the city's chief financial officer, an average Charleston homeowner would see a $5.40-a-month increase on their power bills beginning in Jan. 2011.
But Riley says the $3.8 million from the hike is essential to pay for necessary city services, particularly new needs like the Bees Landing gym and vehicle replacements for the city's first responders and sanitation workers. He also warns of "draconian service cuts" to programs like recreation.
"Are there services we want to diminish?" Riley asked. "If not, then there are no savings. We're not running 'nice-to-have' things."
Councilwoman Yvonne Evans says the council needs to support the fee hike to avoid the alternative.
"I think we all need to be very honest with ourselves and the taxpayers we represent," she says. "We are working on a budget that's hard, but in the end will not have a property tax increase."
White countered that other people are making hard choices in order to keep their lights on. He also raised questions about some of the city's growing electrical costs. Charleston has spent millions on retrofitting buildings with promises of cost savings. That money isn't always evident year-to-year, says Bedard, but there have been very real savings over the long-term, and the city is moving forward with other efforts, including LED traffic lights.
Bedard also noted, ironically, that some of the savings have been offset by rate increases by the power company. With the city's budget, one more is on the way.
Bike registration up
The prevalence of bike thefts in the city, at a rate of almost four a week, has prompted a balloon this year in bike owners registering their rides.
Charleston typically has between 350 and 550 bike registrations a year. It's on track to have more than 1,000 by the end of 2009.
City police have worked with the College of Charleston and bike stores to stress the need for protecting their two-wheeled investment, including a registration push, says Sgt. Dale Wilson.
"It's not a revenue generator," he says of the $1 fee. "The big thing for us is crime prevention and the ability to return the bike."
The Bicycle Shoppe on Meeting Street does a lot of business in bike and parts replacement due to theft, says mechanic Jeff Slotkin.
"We don't deal in used bikes at all for this reason," he says.
Staff encourage customers to go ahead and register their bikes when they purchase by heading up to the College of Charleston public safety office, which accepts city registrations.
From Dock Street to the Gaillard
After a more than $10 million rehab project to address structural concerns, the Dock Street Theatre, one of the city's artistic gems, is expected to open its doors again in mid-2010. The city is expecting about $40,000 in revenues this year from the theater. Staff cut during construction will also be returning to work.
The next ambitious project will likely be the Gaillard Auditorium. The city has received a $20 million gift to go toward what will likely be a more than $100 million reconstruction project, expected to include significant acoustical fixes inside and a major makeover outside.
The city's approach to supporting these and other facilities, with some struggling to pay for themselves, is a concern for councilmen like Aubrey Alexander. He says the city should see more movement toward self-sustainability.
"I suggest that each one of these entities be treated as a business and develop business plans to work toward the goal to make these profitable," Alexander says.
The amount the city expects to lose in business licenses in 2010
The number of city cell phones, averaging out to one for every four employees
The money the city is saving from a longterm hiring freeze
During strong economic years, municipalities across South Carolina would hand out a portion of tax collections to various nonprofit programs. As budgets have tightened over the past few years, these assistance programs are often the first to see cuts, with some municipalities eliminating them entirely.
Charleston has maintained its program, but the amount the city is expected to hand out next year will be at its lowest level since at least 2005. At the height of giving in 2008, Charleston was offering up nearly $500,000. It's expected to be half that amount next year.
Riley vs. Mallard: Round 2
We reported earlier this year on the occasional combative exchanges between Mayor Joe Riley and Councilman Timmy Mallard. The initial vote on the budget was no exception. After Mallard questioned the South Carolina Aquarium's ability to pay for itself, Steve Bedard, the city's chief financial officer, stood in defense of the popular tourist attraction.
Upset over the length of Bedard's response, Mallard commented, "It's going to be a long night with answers like that."
The mayor stood, saying retorts like that wouldn't be necessary.
"I agree," Mallard said, assuming the mayor was talking to Bedard.
"I was referring to your retort, Mr. Mallard," Riley said.