The continuation of the food tax is the least of Phoenix’s worries. The Great Recession along with Arizona’s housing bust ensured we’d feel the pain of an economy dependant on growth for many, many years.
Though the Mayor is getting a lot of flack for a broken campaign promise, the reality is we were misled by many politicians as well as the media. Though it may not have been intentional, good news of a recovering economy seems to have clouded the fact that we are nowhere near the level of revenues we had prior to the recession.
Yes, the economy is growing again, and yes, housing prices are finally starting to climb. But take a moment to remember how far we fell just a few short years ago.
In 2010, the city was facing a $277 million budget shortfall. We needed the food tax. Residents had no desire to fire cops or close libraries.
Repealing the tax should not have been central to any mayoral or city council candidate’s campaign, and the media should have seriously questioned the reality of finding hundreds of millions of dollars in savings without substantial cuts to necessary services.
The Mayor is eating crow, and that’s not a bad thing. He needs to start an honest conversation with residents, letting them know we are not out of the woods yet. Not even close.
Sales taxes may be increasing, but property taxes are still woefully low as is state shared revenue (the money cities receive from the state). The city has yet to reinstate many of the services they cut as well as compensation levels for police, which were reduced by 3.2 percent.
This year’s proposed budget, with the food tax in place, only restores 1.6 percent of pay concessions and continues to cut other city employee positions. The real question here isn’t whether or not we need to keep the food tax through 2015. The real question is, what will happen after 2015?
Make no mistake about it, Phoenix has a pending public safety crisis. I’ve written about the city’s loss of police officers, the length of time it takes to replace those officers, and the fact that the city still has no definitive plans to begin recruiting or hiring.
Keeping the food tax two more years won’t result in additional police officers. The tax is filling a huge revenue hole, not creating room for growth. The fact is, if the city doesn’t drastically restructure its budget, the food tax won’t be going away in 2015 and will likely become permanent.
Residents should be asking the city manager and council some tough questions right now, like how the city will respond to public safety needs in the future if it cannot operate efficiently enough in the here and now, even with an additional revenue source in place.
Do those in the city manager’s office or on the council believe revenues will improve so dramatically after 2014 that the city will be able to both reinstate lost services and pay cuts AND hire additional officers?
Considering the city is currently dealing with a revenue projection shortfall of almost $20 million, I’m skeptical.
Phoenicians need to know how much services cost and more importantly, what they deliver. How do the city’s expenditures and revenues compare with other large cities nationwide? What services, if any, are residents willing to do without? And if we find we cannot or do not want to live without these services, are we willing to find additional revenue sources?
These are the tough questions that we have punted on for far too long. Though the city has made great progress in creating a smaller and more efficient government, economic realities have ensured we will not have the type of revenue streams we had in the past for a very long time to come.
Phoenix can rise from the ashes but only if we stop depending on mythical outcomes and start dealing in actuality.