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The Business Journal of Phoenix
Oct. 1, 2004
Phoenix residents can be proud of responsible city budget
"Phoenix residents happy with city's performance"
"Phoenix reduces budget, cuts services"
Occasionally, newspaper headlines can be a bit confusing. In this case, however, they make perfect sense. That's because both headlines tell of the Phoenix City Council's ability to positively confront a difficult budget situation as we have the last few years. The people of Phoenix are rightfully proud of the city's responsible fiscal management.
In the past three budget years, the slower economy has forced the City Council to make difficult choices and trim more than $100 million from the city's budget- which equates to a 10 percent cut from our general fund budget.
One might assume that such bold steps by the nation's fifth largest city would result in much grumbling from the people of our city. That never happened in Phoenix, however, because the city council, city manager and his outstanding staff and all of the city's nearly 14,000 dedicated employees stepped forward and displayed the much needed fiscal responsibility to get through the tough times.
Alerted early on to the financial troubles by City Manager Frank Fairbanks and Budget Director Cecile Pettle, I suggested the city make mid-year spending cuts. Mid year spending cuts, though difficult, would result in significant long term savings. The Mayor and Council agreed with this recommendation and our quick action helped preserve funds that had been earmarked for spending and soften the blow when the following year's budget was drafted. The savings totaled over $5 million.
During that same period, department directors kept close watch on their individual budgets and continued to look for ways they could reduce spending further without seriously affecting the delivery of services. Employees from every department in the city - police, fire, streets, water, public works, parks and many others - not only helped reduce spending, but they also delivered extra effort in the field.
It is critical to note that our budget cuts did not result in any diminishing of public safety services to the people of our city. City residents played an important role, too, showing that they fully understood and approved of what was happening to the economy and what the city was trying to accomplish with its action. All around, it was an outstanding display of fiscal responsibility. And it has not gone unnoticed. National bond rating agencies such as Moody's Investor Service and Standard and Poor's recognize the city council's strong ability to remain fiscally responsible during difficult times and the city's important bond ratings remain strong
Currently, it general obligation bonds have Aa1 and AA+ ratings, high marks that have allowed the city to broaden the bond market and reduce the interest cost of issuing its bonds.
Phoenix is proud that it maintains the highest bond rating of any large city in the country. The bond rating is critical to ensure our success in future bond programs, which pay for critical infrastructure- like police and fire department radio systems, parks and libraries. The bond rating ensures that people's confidence in city leaders is justified.
City residents voiced their approval of the situation just this year in the city's biennial community attitude survey. Asked how the city was doing in providing municipal services, 91 percent - that's better than nine out of 10 - of the residents questioned said they were very satisfied or satisfied. The favorable response was up four percentage points from the last survey two years ago and was the highest service delivery rating recorded since the city began conducting the studies in 1985.
We are most encouraged by the fact that the favorable review from our residents followed city budget cuts of more than $100 million over the last few years.
The community attitude survey, which is patterned after private businesses that ask their customers how they're doing, is conducted so that the city knows how well it is performing and where it can make improvements.
It's even caught the national eye, winning praise from the Reason Public Institute, a conservative Los Angeles-based public policy think tank that promotes competition and a dynamic market economy as the foundation of progress.
"Phoenix has done an excellent job conducting citizen and internal surveys, and using the results of those surveys to make changes and produce positive results," emphasized Geoffrey Segal, director of government reform at Reason and author of "Citizens' Budget Report" where the Phoenix survey is reviewed. "Phoenix has mastered the art of using surveys to help determine if programs are producing the desired results. If people don't feel they are getting their money's worth from government, it tells officials they should re-evaluate how they are allocating resources or how they are providing the services."
Such great things - healthy bond ratings, strong citizen support and national recognition - don't just happen. They come because the city, its policy makers, its managers, its employees and its residents - all know what it means to be fiscally responsible, during good and not so good economic times.
Greg Stanton is a Phoenix city councilman. He is chair of the Knowledge Economy, Education, Arts and Culture Subcommittee. He can be reached at 602-262-7491 or greg.stanton@phoenix.gov.
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