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Showing posts with label Fiscal Conservatism. Show all posts
Showing posts with label Fiscal Conservatism. Show all posts
Monday, October 19, 2009
Monday, October 12, 2009
Voters Say No to Opt-out
Right or wrong, the people of Roberts County are for sure about one thing - now is not the time to raise taxes.
What people must wake up to is the fact that, if our state doesn't balance our budget soon, we will be completely out of reserves (due to our structural deficit the past 7 years) and an automatic increase in property taxes will kick in.
Now is the time to re-prioritize and tighten our belt: at home and in government.
From the Sisseton Courier, 10-6-09:
What people must wake up to is the fact that, if our state doesn't balance our budget soon, we will be completely out of reserves (due to our structural deficit the past 7 years) and an automatic increase in property taxes will kick in.
Now is the time to re-prioritize and tighten our belt: at home and in government.
From the Sisseton Courier, 10-6-09:
Thursday, October 1, 2009
Balancing Our Budget
I appreciate columnist Bob Mercer's keen interest in the looming $200 million budget deficit for the State of South Dakota. The unnamed state bureaucrat he quoted saying my ideas would have to close universities, state prisons, and state courts is totally out of touch with taxpayers and reality.
The two major culprits that have caused our budget problem are:
A. The worst recession in modern history. We had "rainy day" funds, but instead we got a 100‑year flood.
B. Unfunded state mandates. The current the proposed federal health reform law could place up to a $60 million unfunded mandate on the taxpayers of South Dakota.
We will have to factor into future state budgets the hyperinflation which always follows runaway federal spending such as 16 percent during President Carter's administration.
If South Dakota does not have a balanced budget, our State Constitution provides for an automatic statewide real property tax increase until the budget is balanced. This is totally unacceptable to all but a handful of very liberal politicians who would like to force South Dakota into a state income tax.
This means every South Dakota taxpayer needs to be concerned about our state budget. And we need to help Governor Rounds and the state legislators solve this problem.
As a two-term mayor, I learned the principles of balancing government budgets: hold the line on spending, cut spending to match revenue and defer spending where possible until revenues catch up. Growing the economy with more to tax rather than taxing people more is a key strategy. This is not just my opinion, but the prevailing sentiment I found the past several months as I traveled to 137 communities across South Dakota discussing what taxpayers really want from state government. They want better government not bigger government, and for sure they don't want new taxes.
I have suggested starting on the 2011 state budget using the 2005 budget as a base then we can build toward actual revenues available to keep a balanced budget.
I would also suggest a freeze on state hiring, limiting travel and expenses, and cutting across the board similar to how Governor Janklow handled an inherited budget deficit. It worked then and it will work now.
We also need to redouble our efforts for growth, which increases revenue and provides new and better jobs.
The challenge of balancing our budget and providing for state government needs will continue. It is not a one person job. Meeting our challenges is the responsibility of about 800,000 citizens. We need a healthy debate on how we best provide for the basic needs of South Dakota and South Dakotans. I'm happy to have initiated this debate.
The two major culprits that have caused our budget problem are:
A. The worst recession in modern history. We had "rainy day" funds, but instead we got a 100‑year flood.
B. Unfunded state mandates. The current the proposed federal health reform law could place up to a $60 million unfunded mandate on the taxpayers of South Dakota.
We will have to factor into future state budgets the hyperinflation which always follows runaway federal spending such as 16 percent during President Carter's administration.
If South Dakota does not have a balanced budget, our State Constitution provides for an automatic statewide real property tax increase until the budget is balanced. This is totally unacceptable to all but a handful of very liberal politicians who would like to force South Dakota into a state income tax.
This means every South Dakota taxpayer needs to be concerned about our state budget. And we need to help Governor Rounds and the state legislators solve this problem.
As a two-term mayor, I learned the principles of balancing government budgets: hold the line on spending, cut spending to match revenue and defer spending where possible until revenues catch up. Growing the economy with more to tax rather than taxing people more is a key strategy. This is not just my opinion, but the prevailing sentiment I found the past several months as I traveled to 137 communities across South Dakota discussing what taxpayers really want from state government. They want better government not bigger government, and for sure they don't want new taxes.
I have suggested starting on the 2011 state budget using the 2005 budget as a base then we can build toward actual revenues available to keep a balanced budget.
I would also suggest a freeze on state hiring, limiting travel and expenses, and cutting across the board similar to how Governor Janklow handled an inherited budget deficit. It worked then and it will work now.
We also need to redouble our efforts for growth, which increases revenue and provides new and better jobs.
The challenge of balancing our budget and providing for state government needs will continue. It is not a one person job. Meeting our challenges is the responsibility of about 800,000 citizens. We need a healthy debate on how we best provide for the basic needs of South Dakota and South Dakotans. I'm happy to have initiated this debate.
Friday, August 21, 2009
Fiscal Leadership is a Must
It’s true that we were able to balance the budget this year during our legislative session, but at what cost? Balancing our budget required an infusion of $71 million of federal stimulus money from the national government. Crawling on our knees when times get bad is not a good sign of a healthy, fiscally responsible state that budgets for the future. South Dakota can take care of South Dakota. At present, it is becoming increasingly irresponsible and risky to look to higher powers to plug our budget shortcomings. The Congressional Budget Office recently came out with new numbers that put the United States’ budget deficit at $1.7 trillion. That kind of borrowing from other countries, mostly China, isn’t healthy or sustainable for the country or South Dakota, and we need to make sure we do our part to live within our means.
Creating a position of financial strength, through wise budgeting and a large pool of reserves, will help us to ride through the rough times and help us remain free of influence from higher powers, whether it be the national government or foreign countries.
Creating a position of financial strength, through wise budgeting and a large pool of reserves, will help us to ride through the rough times and help us remain free of influence from higher powers, whether it be the national government or foreign countries.
Wednesday, June 24, 2009
Fiscal Leadership
The City of Sioux Falls looks to be in great financial shape, according to the Argus Leader. A recent audit showed that Sioux Falls is sitting in a comfortable position, with a good reserve fund and a manageable amount of long-term debt. The city has budgeted conservatively in order to maintain a position of financial strength for tougher economic times. City leaders have even managed to decrease the city’s operating costs to levels lower than in 2004.
Leadership starts on the local level. Smart budgeting on the local level eliminates the need to ask more assistance from the state. Likewise, asking less of the state reduces the need for the state to ask the national government for assistance in tough times as well.
The leadership of Sioux Falls has done great work in maintaining the city’s financial strength…keep it up in the future!
Leadership starts on the local level. Smart budgeting on the local level eliminates the need to ask more assistance from the state. Likewise, asking less of the state reduces the need for the state to ask the national government for assistance in tough times as well.
The leadership of Sioux Falls has done great work in maintaining the city’s financial strength…keep it up in the future!
Tuesday, June 16, 2009
Wednesday, April 1, 2009
Monday, March 30, 2009
Why The Increased Spending?
The Pierre Capital Journal reported that the legislature actually increased its spending for the 2010 budget by $6.8 million. Much of this spending has been spurred by the federal stimulus money coming into the state, as well as some alleged “cuts” to the state budget. Some of these cuts were in actuality just a cut to proposed spending, not actual spending…so in reality these were not really spending reductions. More details here…
In times of economic turmoil, sacrifices must be made both by us as individuals and by the government as well in order to maintain a stable spending structure in both government and personal life. Relying so heavily on one-time stimulus money requires no sacrifice by anyone and refusing to make some tough budget cuts perpetuates deficit spending and unsustainable funding practices, which will cause even more budgetary problems next year and even more problems down the road.
The article also states that one specific area that spending was actually cut was in the area of education, specifically in the areas of teacher-improvement bonuses, test score analysis, and teacher training. Education is an investment in the future, and these were worthy areas of education dollars that were axed by the budget.
We need to take a serious look at our state’s spending practices and create a more reliable structure that will help the state live within its means, while at the same time providing critical state services, such as education.
In times of economic turmoil, sacrifices must be made both by us as individuals and by the government as well in order to maintain a stable spending structure in both government and personal life. Relying so heavily on one-time stimulus money requires no sacrifice by anyone and refusing to make some tough budget cuts perpetuates deficit spending and unsustainable funding practices, which will cause even more budgetary problems next year and even more problems down the road.
The article also states that one specific area that spending was actually cut was in the area of education, specifically in the areas of teacher-improvement bonuses, test score analysis, and teacher training. Education is an investment in the future, and these were worthy areas of education dollars that were axed by the budget.
We need to take a serious look at our state’s spending practices and create a more reliable structure that will help the state live within its means, while at the same time providing critical state services, such as education.
Monday, January 19, 2009
A Place Of Opportunity...
Once again, South Dakota ranked as one of the top states that people are migrating to. According the Argus leader, inbound moves to South Dakota were at 57.3 percent, whereas outbound moves were at 42.7 percent. Compared to other states, we ranked sixth in the nation for inbound migration. Read more here…
Much of South Dakota’s attractiveness can be attributed to our low tax burden and lack of an income tax. There was a great article in the Wall Street Journal that compared North and South Dakota. Both states are very similar in resources, jobs, population, etc., but while we have many people coming into our state, North Dakota finds its residents leaving. Both states are similar in many ways, with the exception that we do not have an income tax here in South Dakota.
They say people vote with their feet, and people are leaving states with high taxes, despite the public luxuries those taxes fund, in favor of states like ours that offer greater individual economic opportunities rather than public assistance.
In essence, we are actually increasing the amount of dollars we can bring in as a state by keeping taxes low. Attracting more people to our state with low taxes increases our tax base, since we will have more people here to tax with the existing tax structure.
Much of South Dakota’s attractiveness can be attributed to our low tax burden and lack of an income tax. There was a great article in the Wall Street Journal that compared North and South Dakota. Both states are very similar in resources, jobs, population, etc., but while we have many people coming into our state, North Dakota finds its residents leaving. Both states are similar in many ways, with the exception that we do not have an income tax here in South Dakota.
They say people vote with their feet, and people are leaving states with high taxes, despite the public luxuries those taxes fund, in favor of states like ours that offer greater individual economic opportunities rather than public assistance.
In essence, we are actually increasing the amount of dollars we can bring in as a state by keeping taxes low. Attracting more people to our state with low taxes increases our tax base, since we will have more people here to tax with the existing tax structure.
Friday, January 2, 2009
Finding Funding...
Debate continues over how we’re going to find the resources to take care of our infrastructure needs in South Dakota. Legislators are now proposing raising fees on vehicle registration, as well as increasing gas taxes, according to the Argus Leader. Read more here…
Rather than increase fees on the citizens of our state to find needed funds, why not make sure that all our dollars being spent are being spent wisely? Online databases of government expenditures are great resources for ambitious individuals and press to go and look for wasteful uses of taxpayer dollars. Some states have implemented use of these databases to great success. As part of their state website, Alaska uses “Checkbook Online” to show where tax dollars are spent in the state.
Missouri found many different areas where the state was wasting millions of dollars. Through their site, concerned individuals were able to point out to Missouri that the state was spending $1.6 million at coffee shops, $278,053.46 at floral shops, and $70,849.02 at doughnut shops, among other things. All in all, over the past 8 years the state found more than $2.4 million dollars worth of wasteful spending. Read more here…
Utilizing the technology we have now, we can increase the efficiency of government, rather than increasing fees and taxes on the state’s citizens. The OpenSD site is a great start, and it could be expanded upon to allow watchdog groups, press, bloggers, and concerned taxpayers alike to hop on the internet and discover wasteful spending, and as a result help cut down on wasteful use of resources and allow us to divert them toward more worthy projects for the state.
Rather than increase fees on the citizens of our state to find needed funds, why not make sure that all our dollars being spent are being spent wisely? Online databases of government expenditures are great resources for ambitious individuals and press to go and look for wasteful uses of taxpayer dollars. Some states have implemented use of these databases to great success. As part of their state website, Alaska uses “Checkbook Online” to show where tax dollars are spent in the state.
Missouri found many different areas where the state was wasting millions of dollars. Through their site, concerned individuals were able to point out to Missouri that the state was spending $1.6 million at coffee shops, $278,053.46 at floral shops, and $70,849.02 at doughnut shops, among other things. All in all, over the past 8 years the state found more than $2.4 million dollars worth of wasteful spending. Read more here…
Utilizing the technology we have now, we can increase the efficiency of government, rather than increasing fees and taxes on the state’s citizens. The OpenSD site is a great start, and it could be expanded upon to allow watchdog groups, press, bloggers, and concerned taxpayers alike to hop on the internet and discover wasteful spending, and as a result help cut down on wasteful use of resources and allow us to divert them toward more worthy projects for the state.
Friday, December 26, 2008
A Look At Highway Funding...
KELO reminds us that once again, highway funding will once again be a topic of great discussion in Pierre this legislative session. Legislators are proposing increases in gas taxes and licensing fees to help find the desperately needed funds to ensure our roads are up to par.
According to the South Dakota GOP platform, Government’s responsibility and priorities should first be directed toward projects and endeavors that individuals and private organizations cannot accomplish on their own. Highways and public infrastructure would fall under the category of things that must be provided by government, yet we struggle every year to find funding for these needs?
We need to refocus our budget concerns toward providing first for the “needs” of the state, after which we then move on to providing for the “wants” of the state; activities which are not essential functions of government, but can be provided once critical functions are carried out.
Senate Bill 183 from last year was a step in the right direction. Hopefully the legislature will take a hard look at this one again.
According to the South Dakota GOP platform, Government’s responsibility and priorities should first be directed toward projects and endeavors that individuals and private organizations cannot accomplish on their own. Highways and public infrastructure would fall under the category of things that must be provided by government, yet we struggle every year to find funding for these needs?
We need to refocus our budget concerns toward providing first for the “needs” of the state, after which we then move on to providing for the “wants” of the state; activities which are not essential functions of government, but can be provided once critical functions are carried out.
Senate Bill 183 from last year was a step in the right direction. Hopefully the legislature will take a hard look at this one again.
Thursday, December 4, 2008
Re-establishing priorities…
Today Governor Rounds announced his budget proposal for next year, which included tapping into the general reserves, and—more importantly—the property tax reduction reserve. Read more highlights here…
Dipping into the property tax reduction reserve is essentially a property tax increase on the citizens of South Dakota who are already weighed down heavily with property tax burden.
Over the past several years, the South Dakota Legislature has had the practice of using reserves to balance the budget. Now, during tough times, our reserves are in great jeopardy; as is our commitment to education and other areas of need.
So what do we do?
Unfortunately, we must endure some pain. And it will take a keen eye towards establishing high performance teams in our administration to develop benchmarks and performance measurements to get the job done. It will take strong leadership to bring us out of the structural deficit we are in, to bring this state to a position of fiscal strength once again.
Dipping into the property tax reduction reserve is essentially a property tax increase on the citizens of South Dakota who are already weighed down heavily with property tax burden.
Over the past several years, the South Dakota Legislature has had the practice of using reserves to balance the budget. Now, during tough times, our reserves are in great jeopardy; as is our commitment to education and other areas of need.
So what do we do?
Unfortunately, we must endure some pain. And it will take a keen eye towards establishing high performance teams in our administration to develop benchmarks and performance measurements to get the job done. It will take strong leadership to bring us out of the structural deficit we are in, to bring this state to a position of fiscal strength once again.
Saturday, November 29, 2008
Thinking Ahead...
Governor Rounds announced Tuesday that he is placing a hold on executive branch spending, including a limit on out of state travel, new office purchases, and new hires within the executive branch. All this is an effort to prepare for an expected lull in sales tax revenues, 20% of which the state receives around the holiday season. Read more here…
Preparing for the worst and conservatively estimating revenues is crucial toward creating a sustainable budget and keeping the state out of the red. We went through this very same thing in 2001 and 2002 with the City of Brookings. Tough times call for tough measures, and that includes reducing expenditures rather than using reserves. For the past several years, our state has been liberal in using reserves to ‘balance’ the budget. It is times like these that previous poor fiscal practices catch up with us.
Governor Rounds is doing the right thing, and we need to support him.
Preparing for the worst and conservatively estimating revenues is crucial toward creating a sustainable budget and keeping the state out of the red. We went through this very same thing in 2001 and 2002 with the City of Brookings. Tough times call for tough measures, and that includes reducing expenditures rather than using reserves. For the past several years, our state has been liberal in using reserves to ‘balance’ the budget. It is times like these that previous poor fiscal practices catch up with us.
Governor Rounds is doing the right thing, and we need to support him.
Wednesday, October 8, 2008
Where Is All the Money Going?
If the recent article: "State Raids Funds For Deaf," didn’t catch your eye as a fiscal conservative, then nothing will. A closer look at the last 7 years of state budgets will show you a pattern: a growing structural deficit and spending of not only general reserve funds but also department reserve funds. Before I took office in Brookings as a city council member back in 2001, I analyzed the previous 12 budgets. It is an interesting exercise, much like the spending you do in your own home, you can figure out the priorities and fiscal philosophy. What I noticed was our city spent the money at the same rate of pace as our sales tax revenue generated.
Upon taking office, the City of Brookings was faced with not only a recession and stagnant sales tax revenue, but also a major drop in revenue from our utilities transfer. We were faced with a decision: do you spend reserves or do you make the cuts you need to truly balance the budget. Fortunately we made the right decision and we cut our budget by nearly 10%. And then we did something huge – we set into policy to only grow government at the rate of the consumer price index. The result - budget surpluses and an enviable financial position of strength for our community.
It comes down to this for our state: we must make the decision to reign in our spending and regain a strong financial position, especially in light of the federal funding declines. And we must be willing to be innovative and creative in our approach.
Upon taking office, the City of Brookings was faced with not only a recession and stagnant sales tax revenue, but also a major drop in revenue from our utilities transfer. We were faced with a decision: do you spend reserves or do you make the cuts you need to truly balance the budget. Fortunately we made the right decision and we cut our budget by nearly 10%. And then we did something huge – we set into policy to only grow government at the rate of the consumer price index. The result - budget surpluses and an enviable financial position of strength for our community.
It comes down to this for our state: we must make the decision to reign in our spending and regain a strong financial position, especially in light of the federal funding declines. And we must be willing to be innovative and creative in our approach.
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