POSTED ON MAY 12, 2010:
Mayor's chief of staff responds to city council's questioning of mayor's revenue-generating proposals
On Fire. Mayor Dewey Bartlett Jr. is pitching a few revenue-generating proposals, including an optional $5 fire utility fee each month for Tulsa utility customers, which would support a variety of city services. Opting out of the fee could result in a payment of $500 to $1,000 for a fire service fee, if a fire occurred.
A series of revenue-creation proposals that Mayor Dewey Bartlett Jr. presented to the City Council two weeks ago might not have drawn a positive response, but that doesn't mean the mayor won't continue to tout the ideas as the council's budget-approval process moves forward.
Terry Simonson, Bartlett's chief of staff, said last week councilors would be provided with more in-depth information on the revenue-creation opportunities this week. Simonson said that while the mayor has presented the council with a balanced budget, the opportunity to restore a number of core services that have been cut in order to save money also is there, if councilors are willing to consider some new ideas -- something few of them seemed poised to do two weeks ago, if their initial reaction is any measuring stick.
"I guess what I was hoping I would have heard from at least one councilor was, 'I really want to withhold judgment until I've heard further details,' " Simonson said. "But none of them said that."
Simonson said it is apparently the first time any Tulsa mayor has submitted such opportunities in conjunction with his or her budget.
"In the past, of course, as the council would go through a submitted budget, they were somewhat limited on just kind of tinkering and tweaking with line items," he said. "But there really was very little they could do with the bottom line. And this year, we thought we would give them some opportunities to actually change the bottom line."
The initiatives the mayor has proposed could help expand the bottom line and restore some of the government services that people in the community have every right to expect, Simonson said.
"In other words, we're trying to restore the core," he said. "Restoring the core doesn't necessarily mean that you're growing more government, it just means you're getting back to some of the basic purposes of what government is here to do for the people that live here. That's what we're attempting to do, is climb as much as we can climb ourself out of the financial situation that we find ourselves in."
Bartlett and his staff came up with several ideas, including privatizing the city's parking enforcement service, and raising street parking rates and fines; increasing the fees for first-responder certificates for residents who have a security alarm system that police are obliged to respond to; and an optional fire utility fee for single-family residential customers that would cost $5 a month.
None of those ideas drew a favorable response from councilors, who labeled many of those ideas as thinly veiled tax increases. Simonson took exception to that point of view.
"Contrary to what some councilors said, this is not a tax increase," he said. "There is a clear difference between a fee and a tax increase."
The first difference, he said, is that a tax is mandatory, while a fee is optional. A tax pays for a general government service, not a specific purpose, while a fee does pay for a specific service. He classified a tax as any assessment that raises money in excess of what is needed to defray the cost of a service, while a fee is an assessment that raises what is needed to cover the cost of the service. A tax may be levied in any amount, he said, while a fee covers only the cost of the service. And the charges on a utility bill typically are not considered a tax, but a fee for a specific service, he said.
Whether those precise delineations will change anyone's mind on the council remains to be seen. But Simonson plans to present councilors with other information he hopes will be even more persuasive.
Many of those costs can be covered by the proposals the mayor's office has put forth, Simonson said, who also outlined the amount of revenue the administration estimates would be raised from each of those initiatives.
If parking rates and fines were raised to the point that they are comparable to those in Oklahoma City, Simonson said, the mayor's staff believes it would raise $400,000 annually. Tulsa's street parking system essentially has remained the same since 1992, he said.
"So we decided that placing parking meters and maintaining parking meters is not necessarily a primary core function or purpose of government," Simonson said. "So why don't we try to privatize this out to companies that do that and let them be responsible for the entire management of the parking meter system and at the same time re-evaluate the cost to park and the cost or the fines and penalties."
The increase in rates for first-responder certificates for security alarm systems would generate approximately $300,000, he said. Under the current system, a new certificate costs $15, while the annual renewal is $15 -- unless a property owner has a history of false alarms, in which case the renewal is $30. Under the new proposal, Simonson said, a new certificate would remain at $15, while the annual renewal would go up to $30. Renewals at properties with several false alarms would go up to $60.
Simonson said the Tulsa Police Department received more than 32,000 alarm calls in fiscal year 2009, and an officer was dispatched to the scene in almost 23,000 of those. Of that latter figure, he said, 98 percent turned out to be false alarms.
"So in 98 percent of the time, we wasted valuable law enforcement resources on a false alarm," he said. "So, in order to help cover some of that type of cost, we felt that justified raising the false alarm renewal fee. That's a lot of manpower time spent."
The last proposal -- the optional fire utility fee for single-family residential customers -- is likely to be the most controversial, though it carries the highest financial reward.
Tulsa utility customers would have the opportunity to pay a $5 fee each month on their utility bill to support the return of a variety of city services. Those customers would experience no change in the event of a fire on their property.
But anyone who opts out of the fee and has a fire on their property that the Tulsa Fire Department responds to could be charged a fire service fee of perhaps $500 to $1,000, he said. Simonson said most homeowners insurance policies include a provision to cover such a fee, and the city could bill the insurance company directly. He also maintained that city fire officials believe such a claim would not have a major impact on a policy holder's premium.
"Most people don't even know they have that in their policy," he said.
The mayor's staff has not decided if those who lack such a provision in their policy would be held responsible for the fee, he said.
"That's still being discussed," he said.
Sand Springs and Sapulpa are examples of local municipalities that already charge such a fee, he said.
Simonson emphasized that anyone opting out of the monthly $5 fee need not worry about the Fire Department failing to respond to their property.
"They're never not going to go to your house," he said. "So the notion that, 'They're going to let my house burn to the ground,' or 'I have to grab my lawn hose and put it out' is totally inaccurate. The Fire Department is going to respond, and they're going to put the fire out."
Simonson said the initial proposal was limited to single-family residential customers for technical reasons.
"We need to do further study on multi-family or commercial so we're not exempting them or leaving them out, but we just need to do more work" on those numbers, he said.
The program would be modeled after the city's EMSA program. Simonson said 7 percent of Tulsa residents currently opt out of that monthly fee, and he said the mayor's staff estimated that up to 10 percent of Tulsans might opt out of the fire utility fee. But if 90 percent of residents participate, Simonson estimated the program would raise approximately $6.2 million.
He acknowledged the fire utility proposal could face particularly tough sledding before the council. But he said it might be framed to councilors as a temporary part of the solution to the city's budget woes that could be re-examined once the economy recovers.
"It's a one-year financial bridge, combined with the others," he said, citing the other revenue-creation proposals and cost-saving measures that are expected to be identified in an ongoing audit of city government. "Those will allow us to get back on our feet, and then the council can revisit the fire utility ordinance."
The mayor's administration planned to provide each councilor with a packet this week providing detailed information on each of the proposals, citing the legal authority that would be used to implement them, the cost to operate the programs, the anticipated participation rates and the amount of revenue they would be expected to raise.
Simonson also argued that the mayor's proposals are not so different from ideas put forth by many councilors themselves in recent months. He said Councilor Jack Henderson has proposed a public safety sales tax, while Councilor Roscoe Turner proposed an entertainment tax. And councilors Maria Barnes and Chris Trail have proposed a voluntary donation program.
The mayor's proposals initially included a proposal that would require all businesses operating in Tulsa to purchase an annual $50 license -- an idea that would have generated approximately $500,000 a year -- but Simonson said late last week that idea was being put on the back burner, pending more study.
Simonson said he hopes city employee unions and members of the public will express their support for the proposals to members of the council. He said Tulsans are making it clear they expect to see city services that wound up on the chopping block -- highway lighting, increased mowing cycles, additional graffiti abatement -- returned soon.
"We're all hearing the same thing," he said. "We don't need to run it through some political or personal filter. The message is clear -- when are you going to put those things back?"
Simonson said the adoption of the mayor's proposals would position Tulsa to become one of the fastest-recovering cities in the country.
"It would allow us to go from where we are today to rebuilding in 18 to 24 months," he said. "The significance of that would be we didn't wait entirely for the economy to recover. We took our own destiny in our own hands."
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