It takes money to run a city, and economic growth is what allows a city to provide services for its resident, City Manager Jason Molino believes.
As the City Council wraps up its 2015-16 spending review, Molino is hoping council members will take some time for a serious and in-depth discussion of the revenue side of the budget picture.
"The revenue side of the budget needs focus and we need to understand how to grow that so we enhance and sustain the local economy so that we can provide quality services to residents," Molino said in an interview today. "To sustain a budget we need to ensure a consistent and steady revenue stream. This means the tax base is growing and people have more disposable income."
Molino has written a memo for council members titled "Budget Sustainability (pdf)." It lays out the case for ensuring the city takes steps to improve the economic health of Batavia.
The budget discussion so far has focused mainly on cost containment. The council has taken little time to focus on revenue, Molino says in the memo, but the reason the budget reflects a $250,000 reduction in spending isn't because of cost containment goals. It's because of anticipated declines in revenue. The city is being forced by local economics to cut spending.
That should give council pause as it considers how to handle programs meant to improve the economic vitality of Batavia, such as the Batavia Development Corp. and Vibrant Batavia.
"Public revenue needs an employed community, so the right question is not necessarily where should we be trimming the City workforce budget, but rather, the right question is: Are City resources optimally structured to reposition Batavia as a great place to raise a family, start and operate a profitable business, and in general, appeal to families," Molino writes in the memo.
There are troubling signs in Batavia's economic outlook, Molino notes.
- The city's taxable assessed value of property is not growing;
- Median family income is below average and poverty is high, according to Moody's Investor Services;
- Three of the city's six census blocks are classified "highly distressed areas";
- Five of the city's six census blocks are deemed "low-income."
"A balanced approach to the city budget needs to include strong initiatives that will provide cost containment, but also strategic direction that will improve the quality of life," Molino writes. "Growth in the tax base and resident income are the lifeblood to supporting municipal services, as well as improved quality of life for City residents. All of our focus must be on retaining our households and repositioning Batavia in the coming years to attract more households and businesses."
There are those who believe it's not the role of government to "create jobs" or focus on economic growth. Molino disagrees.
"If you look at the past 10 years, the amount of economic growth, the big job growth, has been the result of public-private partnerships," Molino said. "The ag park, seven years in the making, is the first industrial development in Genesee County in the last 50 years. That came about because of cooperation between the city, county and town, all of us working together."
A local government that is focused on streamlining the process and marketing a community's assets is going to have more success than one that doesn't, Molino said.
"I think the attitude needs to be what are the reasons we should be doing this and not what are the reasons we shouldn't be doing it," Molino said. "It's the responsibility of a municipal government to reposition the community. If you're completely absent from funding economic growth, the community is going to be absent from opportunities for economic growth."
The city's budget is roughly $16 million and that spending, which provides all of the municipal services residents have come to expect from their local government, is entirely dependent on how well the local economy does. Without investment, not only is growth difficult, but a precipitous decline is a real possibility.
While there's no portion of the property tax levy going into funding Vibrant Batavia or the Batavia Development Corp., the amount of money needed to keep those growth projects going is less than 2 percent of the city's planned spending.
"Sure, we can reduce spending by another 10 percent, but if you don't have a vibrant community and a vibrant business base, all you're going to have is a more depressed Batavia with less capacity to provide services to residents," Molino said.
If you've downloaded the Reacht App for your smart phone, at some point within the next day, we'll ask you this poll question: Should the city fund economic growth initiatives? To download the app, click here. Those who download it will be eiligible for a chance to win a $5 gift card from Southside Deli.