INDICATORS: Local governments need to treat budgets like a COVID-19 marathon, not a sprint

As the devastation from COVID-19 continues to disrupt and ruin the incomes of thousands of individuals, businesses, and non-profits, reality is beginning to set in on local government. While local governments watched the private sector fall to pieces, many of them didn’t adjust their current budgets to prioritize needs. In fact, some rejected attempts to prioritize.

On one hand, local government was telling us that the COVID-19 reopening was going to be a marathon, and not a sprint, but on the other their behavior with their finances was the exact opposite of that advice. 

At the end of April, The Argus Foundation wrote an e-mail to the commissions of Sarasota County and the cities of Sarasota and North Port, and the Venice City Council asking them to take pro-active steps with their current-year budgets.

We learned in the recession, that the earlier the prioritization reviews were taken, the more effect it had in curbing drastic cuts later. In our letter we wrote, “The goal of the executive and legislative bodies should be a glide path into budget problems instead of falling off of a financial cliff.”

We stressed that policy makers should not just rely on the actions of their managers and administrator, they needed to look hard at their budget policies as well. 

Many governments were dismissive of our suggestions, pointing to the fact that property values were set on January 1, 2020, and would not be affected by COVID-19. Local governments pointed to economists saying that recovery would begin quickly, ignoring their own statements about this being a marathon. Now, it is clear that the financial recovery will be lengthy.  

One local elected body that took a very active policy action was the Venice City Council. To their credit, they had started to do that even before our e-mail to them. They were not lulled into complacency by the property value argument. On top of that, they really were listening to economists who were saying that while the recovery would start quickly, there is a big difference between starting a recovery and being recovered.    

Now, reality is setting in. State government just received one of the grimmest budget revenue projections ever. This will trickle down to fewer program dollars and capital dollars to local government. 

In fact, local governments need to start preparing themselves for the pass-through cost shifts that state government used during the Great Recession to not raise taxes while the economy was so bad. The state passed many costs to the local governments and required contributions or costs that didn’t exist before. Local governments should prepare themselves for that to happen again — it’s coming. 

While many local government policy makers missed a golden opportunity to ease us into budget and service cuts as the budget year ends September 30, it’s never too late to revisit the next budget year.

Coupled with this moment is an unfortunate opportunity to push the reset button, to make local government programs the best they can be. This also is an opportunity to prioritize existing revenues to current outstanding needs like mental health. Governments should be looking at all of this within their existing budgets instead of funding business as usual.

We need some aggressive elected local fiscal policy hawks to really look at these budgets with an eye towards helping the economy and those who are suffering, while at the same time preventing raising a tax burden on those who have drained their savings, and making mental health matters worse. 

All of the local governments can ease the pain with sound fiscal planning, aggressive policy prioritization, and an urgency to meet the current needs of the community. It’s time to get aggressive, and it’s time to take your own advice — this is a marathon. Wisely pace government budgets and invest your energy in helping current community needs.

Christine Robinson is executive director of the Argus Foundation and was on the Sarasota County Commission from 2010 to 2016. Contact her at christine@argusfoundation.org.