Last week, I wrote about recent developments with Proposition B, the controversial measure approved by voters last fall that mandates an approximate 29% pay raise across the board for firefighters.
The measure comes with a hefty price tag: $100,000,000.00 every year. For context, that’s more than the entire General Fund budgets for all the following departments, combined: Neighborhoods, Library, Housing, Mayor’s Office, Council Office, Finance, Business Opportunity, and Human Resources. The Prop B petition, written by the firefighter’s union, did not identify a funding source for these huge raises. The City of Houston simply cannot afford it all at once without massive layoffs and extensive cuts to City services.
Phasing in Prop B over five years would allow us to implement the will of the voters without layoffs or cuts to services.
But, since the firefighter’s union has rejected Mayor Turner’s offer to compromise, we must and are moving ahead to upgrade pay scales and systems to provide firefighters with their raises starting May 9 th , 2019 (including retroactive pay from January 1st ).
So how do we find an additional $100,000,000.00 a year? The City is committed to implementing Prop B, but we also have to be aware of some limitations on how we can do that.
First, the City of Houston is required by law to balance its budget each year – we cannot go into debt to pay for Prop B.
At the same time, the city is also operating under a voter-imposed property tax revenue cap and a State-imposed sales tax cap, meaning we cannot raise taxes to pay for the measure. Over half of Houston’s budget is tied up in “enterprise funds” like the Airport System and the Water & Sewer System – we can’t legally use our revenue from airport fees or water bill charges, or many other types of fees, to pay for Prop B raises.
We’re in a tough spot, and there are no easy solutions if we have to pay it all at once. Since 2/3 of the City’s budget is workers’ salaries, our only viable option is to lay off employees. Three-quarters of those salaries are for first responders so, in light of all these factors, the Mayor has proposed laying off 400 firefighters and 100 other municipal employees. Additional steep cuts to City services, including parks and libraries, are anticipated, with details forthcoming.
Laying off first responders is a hard choice that no one wants to make, but an independent analysis (completed in 2017, before the Prop B controversy) found that we could safely reduce our fire fighting force by more than 800 fire fighters without impacting emergency response. In fact, Houston has the second highest number of fire fighters per capita of major American cities (in contrast, Houston has one of the lowest numbers of per capita police officers).
Houston is reckoning with the major impact Prop B will have on our budget. Obviously, the best option would be the five-year phase-in, which would prevent any layoffs. I hope that the firefighter union leadership will come back to the table and agree to this very reasonable solution. But in the meantime, we’re working to move ahead – that’s what Houstonians do.