Cost of Wars to Cities Highlighted at Mayors Meeting

June 21st, 2011 - by admin

MSNBC News Services – 2011-06-21 00:46:03

‘That we would build bridges in Baghdad and Kandahar and not Baltimore and Kansas City, absolutely boggles the mind.’
— Los Angeles Mayor Antonio Villaraigosa

BALTIMORE (June 17, 2011) — The annual US Conference of Mayors meeting got off to an international start on Friday, with some backing a resolution to hasten the end of the Afghan and Iraq wars — and channel that spending to cities.

The resolution calls on Congress to redirect the military spending to domestic priorities. The resolution says $126 billion is being spent each year on the wars that should be spent at home to create jobs, rebuild infrastructure, develop sustainable energy and provide for other needs.

When asked to respond to those who argue military efforts have made American cities safer from foreign terrorists, Los Angeles Mayor Antonio Villaraigosa pointed to the cost.

“How did we get to a deficit and a debt larger than at any time not only in U.S. history but in human history? We got involved in two wars that, no matter what you think about those wars, we haven’t paid for,” Villaraigosa said.

“That we would build bridges in Baghdad and Kandahar and not Baltimore and Kansas City, absolutely boggles the mind.”

Many of the mayors speaking at a news conference opening the four-day event also criticized federal cuts that they say have increased the burden on local governments, cuts Philadelphia Mayor Michael Nutter called the “Great Retreat by the federal government.”

Burnsville, Minn., Mayor Elizabeth Kautz, the president of the US Conference of Mayors, said safety at home should be the top priority.

“And along with that it is about our economy and it is about getting people back to work, and it is about reinvesting in those efforts that will help us retain jobs and create jobs in our country,” Kautz said.

The conference represents mayors of the more than 1,200 cities nationwide with a population of more than 30,000. Scheduled speakers include House Minority Leader Nancy Pelosi and Chicago Mayor Rahm Emanuel.

As a candidate, Emanuel laid out big plans to put 1,000 more police on the streets and increase class time for public school students.

But on his first full-day in office on May 17 the former chief of staff for President Barack Obama began tackling his biggest challenge — a projected $700 million hole in the city’s next budget.

Emanuel said his $75 million plan to trim spending sends a message that he is committed to stabilizing Chicago’s finances. His predecessor, long-time Mayor Richard Daley, had nearly exhausted one-time measures available to keep the city’s budget afloat, leaving Emanuel with few options as revenue collections remain at 2004 levels and the cost of running the city escalates.

Mayors across the United States are facing similar financial woes as revenue continues to sag even though the so-called Great Recession officially ended two years ago.

States cut funding 
Compounding cities’ problems is a move by many states to cut revenue sharing to help balance their own budgets.

The National Conference of State Legislatures found about half of US states reduced funding to cities and other local governments in fiscal 2011, while 15 were projecting cuts in fiscal 2012, which begins July 1 for most states.

“So if you factor in that this is the fourth year of closing significant budget gaps, one could imagine that states would get around to (cutting) local governments,” said Todd Haggerty, a policy analyst at the legislatures’ group.

For Pontiac, Mich., the state’s new budget will mean a $2 million drop in revenue sharing at the same time the continuing real estate crisis has decreased property values that will deflate property tax collections by $2.6 million a year, according to a city report released last week.

Revenue sharing and property taxes accounted for $20.7 million or more than half of the beleaguered city’s fiscal 2011 budget and are now expected to fund only 38 percent of fiscal 2012 expenditures.

“So it’s the perfect storm I’d guess you’d say,” said Pontiac Mayor Leon Jukowski, who along with the city council no longer gets paid.

The city, once a major manufacturing hub for giant automaker General Motors, has had a state-appointed emergency financial manager since 2009 after it failed to resolve a big budget deficit.

Story: Does gathering gloom raise risk of double dip?

Jukowski said the city’s workforce was downsized by 100 over the last year, while the Oakland County sheriff has contracted with the city to take over police services in coming weeks.

“Having our own police department in this day and age is a luxury we can’t afford,” he said, adding that Pontiac’s government will emerge “smaller and skinnier.”

Other property tax-dependent cities are also struggling with lower property values as the real estate market remains in the doldrums and foreclosures continue. A Boston study this week found that city’s total taxable value of properties fell by $456 million or 0.5 percent in fiscal 2011, after slumping 3.5 percent in fiscal 2010.

Meanwhile, some cities find their financial problems are too overwhelming and have considered or actually filed the rarely used Chapter 9 municipal bankruptcy.

The California city of Vallejo used bankruptcy to rein in its unions. Pennsylvania this week unveiled a plan to help its capital city of Harrisburg avoid bankruptcy as it deals with a debt-ridden incinerator.

The Associated Press and Reuters contributed to this report.

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