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2010 Oct.25, 2010Restored.P65 1-TENNESSEE TOWN & CITY/OCTOBER 25, 2010 www.TML1.org 6,250 subscribers www.TML1.org Volume 61, Number 16 October 25, 2010 Survey shows intensified financial pain for municipal governments BY GREGORY MINCHAK balance city budgets. munities. Some are innovating and and Financial pressures are forcing finding creative solutions but, re- CYNDY LIEDTKE HOGAN cities to lay off workers (79 percent), grettably, without the necessary re- Nation’s Cities Weekly delay or cancel capital infrastructure sources, cities will continue to have projects (69 percent), and modify a difficult time assisting their resi- Cities’ finances continue to health benefits (34 percent). There dents through these trying economic weaken under the strain of the reces- were also significant increases in the times.” sion, resulting in cities being less number of officers reporting across- Cities are in the worst fiscal able to meet their fiscal needs in the-board services cuts (25 percent) shape they've been in since the Great 2011 and beyond, according to the and public safety cuts (25 percent). Depression, said the report’s co-au- latest research from NLC. Public safety is usually reduced only thor, Michael A. Pagano, dean of the In NLC’s annual report on cit- as a last resort option. College of Urban Planning and Pub- ies’ fiscal conditions, financial of- NLC President Ronald O. lic Affairs at the University of Illi- Each year, the Downtown Paris SPOOK-tacular, on the historic ficers report the largest spending Loveridge, mayor of Riverside, Ca- nois at Chicago. courthouse lawn, gets bigger and better with delicious concessions, cuts and loss of revenue in the 25- lif., said “the easy cuts are gone” as In most recessions, sales tax col- free craft activities, entertainment and contests by organizations and year history of the survey. In the cities are facing the third and fourth lections tend to pick up by the time businesses. Held during daylight hours, merchants invite children, research brief, "City Fiscal Condi- years of tight budgets resulting from reduced property tax values and col- and the young at heart, to trick or treat to their heart’s content and join tions in 2010," 87 percent of city the financial crisis, including a lections impact the economy. But the big costume contest. This year’s event was held October 23. finance officers report their cities downturn in real estate values and the real estate market has not re- are worse off financially than in reduced sales tax revenues. bounded while expenditures con- 2009. “Cities balance our budgets be- tinue to decline, he said. “This year’s report reveals that cause we have to,” he said, “but the “Even if the economy turns while the recession might have offi- extraordinary pain of the recession around tomorrow, cities won’t feel it Iowa League sues EPA cially ended in terms of the national has made it a different time for cities for two to three years," Pagano said. economy, cities are now in the eye of and towns.” City revenues — as generated in “This historic recession has property, sales, and income taxes — BY DENISE PAIGE ronmental Protection Agency’s re- the storm in terms of the recession’s forced city officials to make difficult will decline 3.2 percent in inflation- TML Government Relations interpretation of federal rules con- impact on budgets,” said Chris cerning the operation of wastewater Hoene, co-author of the report and decisions that impact the social and adjusted dollars according to fi- economic fabric of their communi- nance officers. To compensate, city The Iowa League of Cities treatment plants and heavy rain-re- director of NLC’s Center for Re- ties,” said Loveridge. “This reces- officials are cutting back spending, (ILC) filed an action in the 8th Cir- lated discharges; the EPA’s position search and Innovation. “For many sion is making city officials funda- with expenditures declining by 2.3 cuit Court of Appeals petitioning that compliance with the State’s E. cities, the pain is intensifying.” mentally rethink and repurpose the percent. These are the largest cut- for a review of a number of Environ- coli standard be determined “end- The pain is often coming in the provision of services in their com- mental Protection Agency (EPA) off-pipe;” and the new requirement form of service and staff cuts to See SURVEY on Page 7 rule reinterpretations that affect that CSO flows delivered to the municipal compliance in managing treatment facility must have com- wet weather flows (both wastewater pleted biological treatment “if fea- Chattanooga workers reap one-stop and stormwater). sible and affordable.” The lawsuit claims the EPA has Prior to the new position, mu- benefits with Well Advantage Program reinterpreted federal rules, without nicipalities were allowed to use al- going through the administrative ternative approaches and technolo- BY VICTORIA SOUTH rule-making process, that place gies and given options concerning TML Communications Coordinator more stringent requirements on treatment facility design to safely municipal wastewater treatment fa- process peak wet weather flows. Chattanooga had no intention of cilities and could require cities and Johann Coetzee, wastewater direc- rivaling NASA when it created a towns to spend millions of dollars to tor Elizabethton, reviewed the rules healthcare plan for its 6,000 munici- bring their systems into compli- and commented that “The city of pal employees based on financial ance. The matter is set to be re- Elizabethton is an example of a com- rewards, free wellness programs and viewed on Nov. 15 in federal court, munity that invested in TDEC ap- gym memberships, but in 2008, only and Hall and Associates, counsel proved treatment infrastructure, and a fraction of employers across the for the ILC, is encouraging all af- as a result of the reinterpretation of nation offered these types of healthy fected municipalities to join their the rules by the EPA, now cannot use incentives and NASA was on the efforts. all of the designed features.” list. According to Donna Kelley, Since the reinterpretation will These rule interpretations by the Chattanooga’s director of Human affect a number of states, many EPA will more than likely place Resources, and Madeline Green, di- leagues, including the Tennessee many cities in violation of federal rector of Chattanooga’s Risk Man- Municipal League, believe that the rules with no practical options to agement and Insurance, it all began National League of Cities, which come into compliance and subject with some RFPs. represents municipal interests at the local governments to federal law- “Our former mayor, Bob federal level, should file an Amicus suits. Corker, bid on medical products for brief. An Amicus brief is a docu- More information on the EPA the year and the response to the ment that advises the court submit- rules can be found at http:// RFPs ranged from 35-38 percent,” Chatttanooga municipal employees enjoy a free onsite fitness center. ted by someone who is not a party to edocket.access.gpo.gov/2010/ said Kelley. “He said, ‘you all need gram. the litigation, but who believes that 2010-13098.htm and http:// to help us fix this,’ so one of the and a half we’ve paid for our start up “It’s much better than a dis- the court's decision may affect its www.newtonindependent.com/ things we did is ask him to give us costs and I don’t know of any other count; it’s a catalogue,” said Green. interest. files/iowa-league-of-cities-v.- the money he would otherwise have city or agency that’s doing all the City staff can earn and redeem Among the issues are the Envi- epa.pdf . expected to bid. We established a activities that we are with a plan for medical mega fund, harnessing all future activities.” points for participating in health the old money that was being spent With Well Advantage, medical and wellness activities and redeem on services into what we have now.” services are provided free of charge the points online for millions of Who is not covered with The result is the city’s Well Ad- at two on-site medical centers and items including merchandise, real- vantage Program, which is consid- patients enjoy the one-stop conve- time travel booking, activities and unemployment insurance? ered nothing short of an anomaly— nience of an on-site pharmacy pro- event tickets. Staying injury free for a road to health that begins and ends viding prescription medicines at re- a year will earn an employee 2,000 BY GAIL COOK, CPA, CGFM must report the gross wages for each at the workplace for 1,500 of duced costs, (generics are $2 for a CHIPs or 1,000 CHIPS can be MTAS Finance Consultant employee; however, they are not re- Chattanooga’s municipal employ- 30-day supply and $5 for 90-days). earned for having your waist mea- quired to submit premium amounts ees and their dependents plus an Financial incentives are awarded in sured or taking a fitness test. Unemployment insurance is a with the report. It is important for additional 480 retirees. the form of points called “What’s important to us is we program that provides up to 26 municipalities to determine who “Not only has the program met CHIPSRewards, which are avail- can change the program around to weeks of benefits to Tennessee should be included on the quarterly our expectations, it’s exceeded able to all active employees regard- meet our needs, which can be tal- workers who have lost their jobs report. That is the focus of the re- them,” Kelley said. “In the first year less of their participation in the pro- See ADVANTAGE on Page 3 through no fault of their own.
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