Transcript of Mayor Bill Haslam's speech on the proposed budget 

City of Knoxville's fiscal year 2004-2005

April 29, 2004
World's Fair Park

We're here today to talk about the future of Knoxville and I am goingto present a budget to you that sets the stage for moving our Cityforward over the next four years.

To me, budgets are not just about numbers -- they're about vision.We want to be a city that provides excellent services, makesinvestments, takes care of people, and sets priorities.

Let's talk about priorities first.

I promised in the campaign that I would look for efficiencies ingovernment and we're doing that. We're prepared to work harder anddo more with less. I know this is a common phrase out there, many ofyou are doing the same thing in your businesses and your homes. Thecity is no different.

In the budget I present to Council, we will be doing the City'swork with fewer people than last year, in fact, fewer than anytime in thelast eight years.

We're cutting the bureaucracy, but not the service.

The services you value, brush and leaf pick-up, garbage pick-up,police officers on the street, will not be affected at all. And we're goingto add a couple of services that we think you'll really like --- first is a 48hour pothole guarantee. If you call in a pothole on a city street, whetherits in West Hills, Chilhowee Hills, Fountain City or any other cityneighborhood we'll get it repaired in 48 hours – now you can't hold usresponsible for those state highways – but your city tax dollars will betaking care of those potholes on your city streets.

Secondly, we're going to start a 3-1-1 Call Center. Some time in2005, you'll be able to call one number at the City if you're having aproblem or need help with your services. We will invest in thetechnology to do this and train our people, so it will take some time toget it up and running, but it will be worth the wait.

And we think our 3-1-1 Call Center will make us more efficient. Wewill be able to take your calls into one center AND we'll be able to trackthe work, we can find out where we have problem areas and fix theproblems. We'll be able to see where the needs are and if our resourcesare being used wisely.

Here are some other efficiencies we've realized in this budget:

• We refinanced our debt and saved over $5 million dollars – that'sover $300,000 a year.
• We implemented a new performance measurement program to trackour activities and measure our efficiencies and the quality of ourservices.
• We implemented a grant management process so that we can trackany matching funds or operating expense before we apply for "socalled"free money.
• We've changed the way the city's medical clinic is operated andsaved at least $85,000.
• We're going to cut our fleet services by eliminating cars, we don'tthink we need as many cars as we're using which will save hundredsof thousands of dollars, plus the cost of fuel, maintenance, andinsurance.
• The police department is going to reduce the number of cars theyuse and they're going to buy more fuel efficient cars.
• And we're saving half a million dollars at the Convention Centerthrough better management.

I want to stress to you that we're not finished looking for efficiencies.I'm still working my way through city government and learning moreabout it every day --- looking for ways to save more money will alwaysbe one of my highest priorities.

A second priority is building stronger and safer neighborhoods.We're going to make investments in your neighborhoods.

Here are some of the things we plan to do starting with this budget.We're going to pave more roads, including roads in Oakwood/LincolnPark, Fourth & Gill, Mechanicsville, Vestal and all around the city.We'll show our commitment to this much needed city service byspending $3 million to maintain our roads.

We will also commit money to building new sidewalks andrepairing the ones that we have.

We're going to make improvements to our ballparks around thecity, ballparks like Maynard Glenn and Inskip. This is not only aninvestment in our city, it's an investment in our kids….we want themout there playing ball in city parks.

We will also be committing funds to help build the Ashley Nicoleplayground at Caswell Park, a playground that is designed forhandicapped and disabled children.

We hear you when you say you're tired of cars flying through yourneighborhood and that you want the traffic to slow down. It's not aneasy problem to fix, but we will invest money in traffic calmingprograms so that we can begin to take a look at what we can do toencourage people to slow down when they're driving through SequoyahHills, Pleasant Ridge, Lake Forest or any of our neighborhoods.In the four months I've been Mayor, I've heard a LOT aboutdrainage issues…we know it's frustrating and we're committing moneyto keep working on these problems.

We're making these investments in the city's neighborhoods becausewe believe that these investments will protect and enhance your greatestinvestment --- your homes.

It's my job to take care of the city the way you take care of yourhome and it's important whether it's your house or your city to doroutine maintenance to preserve our assets. If we don't take care of thecity's assets as we go along it will cost us a lot more later…in fact, rightnow we have some assets that have been neglected. One of ourcommitments is to handle things like roof repairs and bridge repairsroutinely so that we're not stuck with a really big hit sometime down theroad. I want to keep Knoxville in top shape and I don't want a futureMayor to be in the position of having to spend extraordinary amounts ofyour tax dollars because we didn't take care of the city's assets as wewent along. This is another form of investment. We are going to beresponsible and pay as we go.

And we're developing new assets, we want Knoxville's Downtown tobe a shining star. It's important to continue to make investments inDowntown. A vibrant downtown translates into a vibrant city and wewant to do everything we can to make downtown a premier destination.If you haven't been down to Market Square you need to go, it's greatand it's not even finished. Construction on a new parking garage behindMarket Square is about to begin and we're going to put a movie theateron Gay Street…… another reason for people to come downtown.

Sundown in the City is back on Market Square and it's a huge hit, wehad 10,000 people come to the first concert, that's exactly what we wanthappening downtown. A week and a half ago we had an unbelievableweekend downtown with over 40,000 people showing up to celebrate theRossini Festival, Dogwood Arts Festival and the plant show. When theTennessee Theater reopens in January we will be proud to say we were apart of the renovations. We also have plans for a new Transit Center,it's primarily financed by the federal government, but we'll share in thecosts. And finally, we have an icon downtown and it's not just an iconfor downtown….it's an icon for the whole city….the Sunsphere. Anytime someone puts out a brochure or a ticket or something relating toKnoxville, you see a picture of our icon, the Sunsphere, but right nowyou can't even go inside or take an elevator ride up to see the view. It'stime we fix it up and get something in there….let's take this symbol thatrepresents Knoxville and make it something special for our citizens andour visitors.

We're all aware that East Tennessee has serious air qualityproblems, that's why we'll continue to make an investment in KAT andencourage our citizens to consider mass transit as an option. By the endof the year, 90% of KAT's fleet will be equipped to use alternative fuels.I promised during the campaign that I would keep a card in mypocket with the names of corporate headquarters we would try to get toKnoxville, it's still here and we've made some calls to these companies.Economic development will make our city stronger --- we want to bringmore and better jobs here. I'm proposing we invest in the Jobs Nowprogram. I like the fact that it is about producing measurable results injob recruitment and raising wages in our region. We think the best wayto get results is to work with our partner, the Chamber.

Let me talk for a minute about some of our other partners. Duringthe campaign I talked about the need to have good relationships with theCounty, the University of Tennessee, the Chamber and other keypartners. These relationships have helped us to work smarter and we'reexploring ways that we can work together to save you money, it's justthe right thing to do.

I've saved the city's most important asset for last…..our employees.I am proud of the men and women who work for the city of Knoxville.Our employees work hard for the taxpayers and take great pride inserving the citizens. If you're sitting next to a city employee take aminute to say thanks for all they do for you - like patrolling yourneighborhoods, catching the bad guys, fighting fires, picking up yourbrush, repairing your sidewalks, paving your roads, having nice placesfor your kids to play, making our by-ways look beautiful – I could go onand on. That's why we want to invest in our employees and give them a2.5 percent pay increase, and we are increasing the salary of employeesat the lowest end of the scale a greater amount as recommended in ourrecent salary survey.

We are not reducing the number of officers on the street or thenumber of fire halls. Efficiencies in those departments will be found inother ways.

Now it's time to talk about the hard truth. This administration wasleft with a budget that too often dipped into its savings account. For thelast two years the city has spent more than it has brought in. As he wasleaving office, Mayor Ashe warned us on more than one occasion thatthere were tough times ahead. He often talked about the shortfall beinganywhere from five to ten million dollars, the reality is it was closer to$10 million dollars. Our health care costs and worker's compensationclaims have gone up over 15% annually and our pension costs foremployees have also skyrocketed. In addition, we have a conventioncenter, while a great asset, it's also a drain on our finances. Those are thetough issues we faced as we prepared this budget.

I am not going to let those tough issues stand in the way of movingthis city forward. I am fully committed to taking care of our city andmaking investments for the future and to quit borrowing from oursavings account. To do this I'm prepared to pay for it by asking for a taxincrease. We are proposing increasing the tax rate by 35 cents – that's$5 a month for the average homeowner.

We have worked very hard to make this an open process.

Everyone could see the pain of making deep cuts and no investments.We think we're presenting a responsible budget that has built inefficiencies and investments. I hope you will agree with me that it'sworth an extra $5 a month to work toward the goal of making KnoxvilleAmerica's premier city in which to live, work and raise a family.Several people have asked me, how did we get in this position?

Why do we need a tax increase?

To begin with, our situation is not that different from most othercities around the nation. Most cities are dealing with the cost of risinghealth care, obligations to fund pensions, escalating worker'scompensation costs, and an aging infrastructure, whether it be roads,bridges, or software systems. In addition, as I noted earlier, as a city wehave been spending more than we have brought in for the last couple ofyears. This can't, and won't, continue under my watch.

When we combine these cost pressures, with the fact, that as a city,we're not growing very much, there's a problem. Most of the residentialgrowth in our area is happening outside of the city limits. Sales taxgrowth, while it has picked up lately, has a limited impact, in that 72%of the sales tax collected in the city goes to the county to help pay forour school system.

In a nutshell, our problem is that we are not growing our revenuesin a time when our expenses continue to rise. So, what can we do aboutit?

In short term, as I mentioned earlier, we will have to have a taxincrease, I don't like that any more than you do. But, looking out at thefuture, we will have to do two very important things. First, we have tofocus on growing as a city. If we don't have consistent, real growth inour city, we have no option except to raise taxes. Secondly, it is the jobof city council and myself to rein in the increases in our expenditures.Health care costs, worker's compensation costs, repairing roads andsidewalks all of those pressures will continue to exist. It is our job tofind new ways, different ways, less expensive ways to conduct the city'sbusiness.

My pledge to you is that we will work tirelessly to do that. Itshould be worth noting, that even with the proposed tax increase, afteradjusting for inflation, the city's tax rate is less than it was 10 years ago.I understand that those are your hard earned dollars and I pledge to youour efforts to use them wisely as we work to make Knoxville America'sPremier City in which to live, work and raise a family.

Thank you for giving me the opportunity to serve as your Mayor.