I live around the corner from our city hall, which is surrounded by a park that I walk my dog through nearly every day. Last Friday afternoon, as we went by, I spotted one of our city council members, whom I've know casually since I moved here twenty-ish years ago, sitting in front of City Hall with a package of 11x17 papers in his lap. We went over to say hello. The papers turned out to be the city's projected numbers for the coming years.
If I am understanding what I was shown and explained, staff has predicted a budget shortfall of over a third of our yearly revenue in four years. This was apparently assuming steady 4% growth. (Our yearly revenue, primarily from a portion of property tax and sales tax, is about 28 million dollars. The projected shortfall in four years was a little over 10 million dollars. Our current population within city limits is about 10,000 people, roughly 4,000 households.) As a Strong Towns member (and occasional contributor) this news was not at all shocking to me: rich people live here, but that doesn't mean we're not going broke.
In discussing our predicament, we agreed that the cul-de-sac suburbia and big box stores built in the northern edge of our town in the last decade had infused immediate money into our city but had also created long term liabilities. We also both felt that annexing the area of the county surrounding our city that the state had designated as part of our "urban growth boundary" would further harm our finances. (Some background about this can be found in a previous Strong Towns article I wrote). But as we talked further, it became apparent that this council member thinks that the way to get on more secure footing would be to cut expenses and that residents would be willing to accept fewer services and improvements (and possibly higher taxes) if it meant that nothing else here had to change.
My perspective has been shaped by Strong Towns and friends (the usual suspects: Tactical Urbanism, Granola Shotgun, Blue Zones, The Messy City, Copenhagenize, Small Builders/Developers, the Sightline Institute, Better Block, Shoupistas). I tried to make the case that we should be seeking to boost revenues by allowing "the next increment of growth" in areas where we have already made public investments in infrastructure and services. I pointed out that we are losing out on revenue because landowners are keeping properties in prime locations vacant or nearly vacant waiting to be granted special development rights. Meanwhile, they’re paying low taxes and contributing little to our economy.
My solution to insolvency is to increase revenue by encouraging private investment. This means sending out a twofold message: on one hand, that we are not going to get so desperate for anyone to do something that we will make deals with developers that break every rule in our zoning code. But on the other hand, that we will remove over-reaching regulations (i.e. those that do not affect health and safety) in order to incubate and grow businesses and try to meet the demand for more affordable housing. In our town, a good start to allow the "next increment" of housing would be updating our restrictive ADU regulations and permitting duplexes in areas zoned "low density residential" around our city center.
How is improving your town’s fiscal strength like improving your cycling performance?
To see improvements in cycling, a rider needs to increase their power to weight ratio. More power would be comparable to increasing revenue, and cutting weight would be like lowering expenses. To be financially strong, a city needs to increase their revenue to expenses ratio.
For all but the most elite of athletes, riders can probably figure out how to drop a few pounds. This could be easy, like emptying unnecessary items from a bike bag. Or it might be a bit painful, like forgoing dessert to lose a pound or two of excess stored energy. And I doubt any city is so well run that there is nothing that can be done to reduce expenses. Some of these measures might be low impact—like buying new vehicles for the city less often—and some might be a bit more difficult, like trimming arts and recreation budgets.
But a bike rider has to be careful not to cut weight in ways that will negatively affect performance. Not bringing water along will reduce the weight of the bike, but it would be foolish because dehydration isn’t going to do you any favors. Depriving oneself of calories to the extent that the body begins to break down muscle for fuel will lead to a lighter rider, but generally a weaker one. Reductions to city budgets shouldn't diminish returns. Letting go of public works department workers may save money, but if businesses relocate because their surroundings are neglected, the city will lose more in revenues than it gained by reducing salaries. It would also be counterproductive to de-fund cultural events that are bringing in more than they are costing the city to sponsor.
To improve power-to-weight and revenue-to-expenses, it is critical to look at both sides of the ratios. Cutting weight has to be done thoughtfully—and even then, its effects are limited. It’s often more beneficial to increase your power. Similarly, even if done flawlessly, improvements to city balance sheets will be marginal if we succeed in lowering costs but not in raising revenues.
How can a cyclist gain power? Gradually increase ride distances and elevations. i.e. go longer and climb more hills! Keep in mind that big jumps in difficulty, like going from riding 25 to 100 miles in a single week, will lead to injuries and setbacks. Riders will also see improvements if they occasionally push themselves to keep up with and learn from slightly fitter and more experienced cyclists.
Which leads to the million dollar question: how can a city increase revenues? The incremental steps that Strong Towns recommends might be comparable to avoiding attempting to make huge leaps in fitness over short periods of time. Evaluate private investment for its long term benefits and then cultivate productive growth. Understand that while your city might not be exactly like others, there is value in examining what has been successful elsewhere.
In order to attempt these enriching strategies, a community has to be willing to allow and possibly even encourage evolution. The building of a whole new, more car-dependent, annex to our existing city was motivated by the desire to freeze the historic center in time. Seeing the downsides of this addition has further soured residents on any new growth. Thus the appeal of trying to balance our budget by cutting expenses, rather than attempting to raise revenue from the investments we have already collectively made. If a bike rider does not fuel properly and does not train to build muscular and cardiovascular fitness, they are very likely to bonk. If our city cuts expenses but continues to discourage creative people from investing here productively, the crash will inevitably come.
(Cover photo: Kinley Gibson via Flickr)
About the Author
Strong Towns member Marlene Druker is an architect in Washington State and the wife of a third generation commercial fisherman in Gig Harbor. Marlene thinks and talks about riding bikes and thinks and talks while riding bikes. She is a volunteer Ride Leader and Outrider (providing on ride support at major cycling events) for Cascade Bicycle Club and the founder of Bike - Gig Harbor and Strong Gig Harbor.