Rochester City Budget over the Last Decade

This will be the first of a number of posts analyzing what has happened to the City of Rochester’s budget over the last decade.  I have been gathering data regarding population, inflation, budgets, LGA, and taxation.  I am going to tag these items with “decade lookback.”

There have been so many false statements made about taxes and government spending that I wanted to create a resource for the citizens of Rochester that could be trusted, while I may have many personality flaws, honesty has never been one.  I am gathering the data myself (with the help of a number of people and organizations) and will allow others to review the calculations for accuracy.  The project is not complete, and there is more review to come.

My intent is to inform the public of my findings and rely on them to force their elected leaders to make changes.  While I have years of education and experience in finance, I understand that not everyone does, so I will also clarify any terms or calculations at my citizens’ request.

Here are three important terms:

  • Nominal Growth – Growth in spending in absolute terms, ignoring inflation.
  • Real Growth – Growth in spending after removing inflation from the equation.  As much as we might like to, we can’t buy a gallon of Diesel for what we did in 1965…
  • Per Capita Spending- This means cost per citizen, as the city grows cost will as well.

Hera are a few interesting early findings:

  1. The real per capita budget of Rochester is about 10% lower today than in 2001.  The operating portion of the budget was flat.
  2. Essentially all of the real property tax increases in Rochester are due to decisions by the state, including LGA cuts.
  3. Many people think of economies of scale, but Rochester is actually seeing diseconomies of scale.  We are actually seeing increased costs per capita of public infrastructure and public safety per citizen as we grow.  The reason for this is very simple: Sprawl.
  4. Spending on public safety is eating away at everything else in the city.  About 60% of the nominal growth in spending has gone to public safety.  A portion of this is citizen expectations, but a large portion is also due to sprawl.  Consider that a fire station covers a fixed area to ensure response times; if 30,000 people live in that area it costs far less per capita than if larger lot development has 5,000 people living in the same sized geographic area.
  5. We are spending less on quality of life amenities per capita than we were 10 years ago.  We spend about 7.5% less in real dollars per capita on the amenities that make Rochester a great place to live.  This includes the Arts, Parks, and Libraries.
  6. Massive subsidies for certain industries, especially land development, are causing large increases in fees and draining an already reduced capital budget.  In the last decade the taxpayer has been increasingly called upon to subsidize development, specifically sprawled automobile only development.  This is the most costly type of development.  Over the next decade taxpayers will be paying hundreds of millions in subsidies for land development and higher maintenance costs due to the style of land development.

Much more to come.

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