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Council must keep city finances strong

September 24, 2018

If you live in Beaumont and would like one less thing to worry about, you can put the city’s finances on that short list. City government is in good fiscal shape, which is gratifying enough for any town. Coming one year after Harvey soaked and ruined large parts of this city, it’s downright impressive.

Last week the City Council approved a $126 million budget for the new fiscal year. That’s up 3.5 percent from last year. Things are so good that city employees got a 3 percent pay increase.

Ironically, Harvey itself has something to do with the healthy balance sheets. Retail sales taxes surged 13.5 percent this year as people and businesses cleaned up or rebuilt because of that storm. That strange phenomenon also followed Rita and Ike. It matters a lot for the few cities like Beaumont that rely heavily on sales taxes to finance city operations instead of property taxes. City Hall was even able to set aside $5.2 million of the sales tax bump for the city’s reserve fund.

Credit also has to go the City Council and staff for keeping the city’s finances strong. Taxpayers jump on them when they mess up, as they should. When they get it right, they deserve kudos, too.

If there’s a cautionary point here, it’s that the council shouldn’t get overextended. Sales tax revenues will be smaller this year without the Harvey bump. The $50 million bonanza from the natural gas wells at the municipal airport has come and gone. Several council members have noted nagging problems in some parts of the city, like the high number of vacant properties in the First Ward represented by Virginia Jordan. The city has poured millions into better streets, yet many more street projects await.

Because of these factors, the city work force should not be unnecessarily increased just because there’s money now. Those employees will have to be paid in future years if sales taxes slump or a recession occurs. Laying off employees then is painful, and politically difficult. It’s much better to keep workforce levels right where they need to be, enough to provide essential services but not more than taxpayers can afford.

In the meantime, Beaumonters can enjoy their good fortune. This is good news for them, and the rest of Southeast Texas since Beaumont is the largest city in the region. The ripple effect can spread outside the city limits, with stable tax rates in Beaumont that encourage more jobs for all and more places for dining, shopping or entertaining.

Let’s appreciate it, and let’s build on it.

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