Now, we learn that the Commission will use part of the tax increase to make up for an expected 2010 budget shortfall. The Commission’s decision to use (arguably) 2009 tax money to balance the 2010 budget is not unexpected. Last year, while Chairman Bannister and staff were sounding the alarm and Kevin Kenerly was putting his "lame duck" status to good use (by RE-proposing the tax hike), Bovos was quietly moving 2009 expenditures into the 2010 budget. The items moved included almost all of the expenses that were used to justify the hike…. three fire stations and equipment, 58 police officers and money to keep the lights on at the little league ball fields.

The county ended 2009 in the black…. in other words, the 2009 (calendar) tax rate of 10.97 paid for everything that remained in the 2009 budget. It was ALWAYS Bovos’ plan to delay enough 2009 expenses to end the year balanced.

The 2009 tax hike (collected this year, as you know) was ALWAYS going to be spent on 2010 expenses. Bovos told the committee in December that he had hired a consultant and was already looking into using the revenue from the hike to pay down accrued liabilities instead of funding fire stations and police, as had been the "carrot" in 2009.

A large number of members opposed Aaron’s plan to use the tax money to pay down the county’s $300 million in unfunded liabilities. The subject was never brought up before the committee again; however, it remained on our radar screen. Some members supported using half of the revenue for unfunded liabilities and the remainder for the promised purpose. I wanted all of the revenue from the tax increase to be used to fund the promised services.

I do not know what the county actually did. As reported by the AJC, they are doing exactly what they had planned to do by taking a portion of the tax revenue to pay 2010 expenses. I do not know if they still propose to or have actually paid toward liabilities.

I am not accusing the Chairman and Aaron of being deceptive, except that the end result of their failure to provide all of the facts is that the taxpayer has been deceived…. several times… over the past year. One of the new fire stations is near my home; it still sits empty, although the chain link fence that had surrounded the building has been taken down.

While this year’s budget is balanced, next year’s spending plan already is $31 million in the hole. In a recent interview, Bovos said that could grow as declining property values continue to erode tax receipts.

Update: The GDP article on the same topic reports that part of the tax increase is being used for unfunded liabilities:

The money, from a millage rate increased imposed late last year after property tax bills had gone out, includes $18 million to reduce this year’s deficit, as well as $10 million to pay outstanding debt and $5 million for the Gwinnett Hospital Authority to complete a commitment to give $5 million for five years. Another $21.2 million will be applied to the county’s accrued liabilities, which include retiree health care and pensions.

If my math is correct, the tax hike revenue has been spent. It remains to be seen whether or not the county will open the fire stations and hire the cops.

Gwinnett commission taps tax hike proceeds to balance 2010 budget  | ajc.com

The vast majority of the 120,000 residential property notices issued in the first batch will show an average value decrease of 17 percent or $35,000 of market value, Pruitt said. The sum of all decreases for residential property totals approximately $4.2 billion of market value.

As I explained in “Tax Digest Time Bomb,” the lower tax value may not necessarily translate into a lower tax bill. In fact, as a result of the 2009 tax increase that is being continued for 2010, you will probably pay a lot more than in previous years.

Gwinnett property owners may get good news  | ajc.com

Budget `Bait and Switch`

Bannister presented his 2010 budget to the other Commissioners and to the public on December 1, as required by law. The law is designed to give the public ample opportunity to review the document prior to its adoption. The required public hearings were also held.

A day or so before Christmas, however, Bannister sent the Commissioners a revised budget which increases spending by $6.3 million. Not only that, but Bannister juggled a number of capital projects, fast-tracking a park development in his home city of Lilburn while postponing a new park a few miles from the home of Mike Beaudreau, the only Commissioner to vote against the 2.28-mill tax increase.

Even worse, Bannister’s unilateral revision of the published budget may be illegal.

Some of Bannister’s changes:

• $500,000 subsidy to Partnership Gwinnett;
• $82,000 related to the county’s AAA bond rating;
• $6,500 for the County Administrator’s attendance at various conferences.

Bannister proposes to pay for these additions by transferring $500,000 less from the operating budget to the capital budget later in the year, as has been the usual practice. The artful number tweaking allows Bannister to increase non-capital spending without adjusting the operating budget’s bottom line by a single dollar.

Capital spending will increase by much more than the $6.3 million that Bannister proposes to add to the budget. He will make up the difference by deferring other projects including the Harbins Community Park in the Archer school cluster.

Bannister wants to postpone the engineering phase of the District 3 park from 2010 to 2013. He will instead spend that $1.2 million on the Lion’s Club Park in Lilburn this year, rather than in 2012 as planned. There appears to be no justification for this swap except to punish Beaudreau for his continuing stand against wasteful spending and tax increases.

Other additional capital spending:

• $250K for an airport feasibility study;
• $500K for a “nuisance abatement project;”
• $7.6M for fire stations #31 and #10 (relocation);
• $110K for a police aviation fuel truck.

The revision will also postpone development of the Rabbit Hill Park from this year to 2013.

Bannister proposes to increase the budget despite the county’s expectation that 2010 will be worse economically than previously projected.

Budget Deception

State law appears to prohibit the revision of the published budget proposal, except by a majority vote on an amendment during a public meeting… or by starting the public hearing process anew.  The Chairman cannot simply change the budget published on December 1 on his own.

The Chairman’s plan to adopt a budget different from the one that was presented to the public is tantamount to a lie. But then, deception appears to be Bannister’s stock in trade.

After the  2.28-mill tax increase was adopted, the county’s finance director announced that the additional revenue might be spent to reduce the county’s accrued liabilities, even though the increase had been sold as necessary to fund police officers, fire stations and recreation. Apparently, a decision on what the money will actually be spent has not been made.

I strongly encourage you to contact the Commission and send Bannister a message similar to the following:

Commissioners, I do not want you to approve a budget different from the one for which public hearings were held, except by amendment in a public meeting. I do not want you to increase spending. Chairman Bannister, I insist that you honor the expectations created by last year’s millage increase hearings and budget hearings.

To be effective, you must send your email before the Commission’s 2 pm meeting today.

If you’re totally against a tax increase, you face an uphill battle. The reality is that there are already enough votes to pass the tax hike as proposed. Chairman Bannister has signaled that he will support it, as has Kevin Kenerly, who isn’t running for reelection. Shirley Lasseter is a sure second vote for Bannister; Bert Nasuti is also a lame duck but is open to reason. Only Mike Beaudreau is expected to oppose it.

There is, however, plenty about this proposal to criticize. As I will explain, the increase could be reduced by 32% and still fund the full restoration of service levels for this year.

SaveGwinnett.com » The Tax Increase: Myths and Misconceptions