Oak Ridge Today

Guest column: Changing the economic development game in Oak Ridge

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There’s no nice way to spin it: The results of our city’s bad decisions for the past decade are catching up with us.

In addition to having high debt and property taxes, our sales tax revenues continue to decline, we are exporting more than $727 million per year in U.S. Department of Energy payroll (1), and we have a comparatively stagnant population growth. Even with all the new restaurants opening, these projects won’t fully replace the revenue we’ve lost from the countless businesses that have closed up shop or left town for greener pastures.

Continuing down this path is not an option. Thankfully, our city manager understands this and wants to strategize a more competitive position for Oak Ridge. He is proposing that we change our approach to economic development (2) by finding other uses for the $1-2 million we’ve been spending annually on nearly 20 different external organizations like the Oak Ridge Chamber of Commerce.

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Guest column: Let’s work hard rather than ‘rubber stamping’ water, sewer debt

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We are only a few days into 2013 and most of us have discovered that we will have to make do with less this year. Before January ends, Oak Ridgers will realize that fact again when they receive their water and sewer bills, which will reflect the second rate hike since last May.

But before you have a chance to see your newly increased bill, Oak Ridge City Council may take an action that will cause your rates to rise a third time before 2013 ends. On Jan. 14, City Council will vote whether or not to apply for two state loans totaling $18 million. This debt, in addition to a large portion of the $15 million issued since September 2011, will pay for work affiliated with a U.S. Environmental Protection Agency administrative order that requires the city to stop sewer overflows.

All $33 million borrowed will be paid by Oak Ridgers through multiple increases in your water and sewer rates. The amount of those increases is not determined until after each round of debt is issued. In other words, the city first borrows on your behalf and then determines how much it will charge you without consideration for your ability to pay.

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Guest column: Does Oak Ridge have a revenue or spending problem?

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We here in Oak Ridge are repeatedly told that we do not have a debt problem, we have a revenue problem. All of our issues can be solved simply by increasing our revenue. Translation: The city needs more of your money.

The truth is, revenues aren’t down. They are actually up by $55 million for the last 10 years.

The data shows that our root problem is not revenue-based but spending-based. Oak Ridge is the single highest taxed full-service city in the state. We have priced ourselves out of consideration, sight unseen, to new residents and businesses. Every year for the last decade, we have knowingly budgeted to spend more than we bring in (see tables below). How do we make up the self-created deficit every year? Simple. We incur debt, and we deplete reserves.

Over the last decade, over 21 million of your tax dollars have been spent in the name of economic and community development. This is in addition to the dozens of tax breaks that we’ve given to select businesses. Every way that there is to throw money at our problems, we have done it.

Yes, we have some recent developments that we can celebrate. But we need to be realistic about their impact. For each new store, how many have quietly closed up shop and left town? And how many years before we see the projected new revenues?

It is time for a serious strategy change. We cannot possibly expect to attract new residents and new businesses as long as the very people who live here say that they can no longer afford to stay. If we are to achieve any substantial progress, we have to become competitive. It is time to stop throwing money at our problems. There is only one way that city council can truly improve our economy and that is by leveling the playing field with our competitors by lowering our property tax rate, lowering our debt, and lowering our spending.

 

Ten Year Snapshot

2002

2012

Total Revenues

$118M

$173M

Total Expenditures

$135M

$179M

Total Debt

$104M

$186


City of Oak Ridge Budgeted Revenue and Expenditures

 

Revenues

Expenditures

2002

$118M

$135M

2003

$120M

$152M

2004

$126M

$134M

2005

$126M

$134M

2006

$131M

$177M

2007

$137M

$184M

2008

$145M

$184M

2009

$164M

$183M

2010

$172M

$179M

2011

$173M

$179M

2012

$173M

$179M

Source: City of Oak Ridge Final Budget for years 2002-2012

http://www.oakridgetenn.org/department/Finance/content.aspx?article=1853

Guest column: Oak Ridge needs debt policy, debt ceiling

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Trina Baughn

Trina Baughn

At under 45 minutes, this month’s City Council meeting may have been the shortest meeting they’ve ever held. While it was a nice change from the normal three-hour meetings, I wonder why council didn’t take the opportunity to discuss anything of significance given our city’s various, not to mention serious, problems. After all, they are limited in how often they meet to accomplish anything. Yet, they were perfectly content to accomplish nothing.

Nearly a year ago, I wrote about our city’s debt—a bill that is quickly approaching $200 million. I implored the city to develop a debt policy that would establish a debt ceiling, a debt reduction plan, and parameters for borrowing.

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Baughn: Let’s lower the property tax rate

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Trina Baughn

Trina Baughn

The future of Oak Ridge is entirely dependent upon our ability to attract new residents and businesses. To do that, we must first acknowledge an unspoken truth: Outsiders view Oak Ridge as being too expensive. We must work to change that. Oak Ridge must become competitive.

Why do people say that it costs so much to live and work in Oak Ridge? What I hear is that our leases, properties, gas, and even our groceries, all cost more than our neighboring communities. I haven’t verified that to be the case, but those are things that the city government can’t (and shouldn’t) control.

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