February 16, 2009
Tough times for local governments

It's gonna be a bad year.

They're not feeling the economic storm quite yet, but local governments across the Houston region are hunkering down anyway. Some have frozen hiring, others have stopped filling potholes. Planned purchases of police cars, golf course mowers, Tasers and sewage equipment have been halted.

The caution infecting budget offices is universal, whether down south, where Galveston County is anticipating shrinking its budget by $5 million, or up north, where Montgomery County continues to rake in the tax dollars from growth. All are playing it safe, waiting for property reassessments and 2009 sales tax figures to come in before making any major decisions.

"We need to be watching every dollar that we spend," said Cheryl Hunter, Texas City's director of finance. The recession may have come to Southeast Texas late, but it has come. Public finance officers fear a future double-punch: lower tax revenues from a slower economy, combined with Hurricane Ike's destructive effect on tax rolls in coastal towns, counties, and school districts. After years of growth and decreasing tax rates, budget officers now just want to hold on.

Texas City lowered tax rates for two years, but probably will not this year. The overall budget will stay flat. On hold: a $1 million renovation of the Texas City Museum, and a $5 million expansion of Moore Memorial Library.

Baytown, Freeport, Sugar Land, Katy and Metro already have declared hiring freezes. In Pearland, there is no official freeze, but officials have postponed filling 10 positions - four of them police officers.

"So far, from the recession we're not seeing any (revenue) impacts yet," said Pearland's finance director, Claire Bogard. Rebuilding after Ike even gave sales taxes a boost, as did the opening of two new retail centers in Pearland. Nevertheless, Bogard ordered department heads to identify ways to trim 6 percent from the next budget, just in case.

Guess that means Bill King won't be running for office in any of those places, either. All I can say is that I hope none of these local officials are counting on any help from Rick Perry. If he thinks the feds shouldn't be helping state governments make ends meet, he's unlikely to think any differently about the state helping the cities and counties. At least there's a chance that the Lege could bypass him and share the largess, such as it may be.

Posted by Charles Kuffner on February 16, 2009 to Budget ballyhoo
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