Editor’s note: One in a series of stories on mayoral race issues.
One day before voters head to the polls to elect East Baton Rouge Parish’s next mayor-president, Kip Holden plans to present his 2013 budget proposal to the Metro Council, meeting a deadline set in the Plan of Government.
If similar to the 2012 version, the 2013 budget will run more than 500 pages and provide a detailed accounting of how Holden’s administration plans to spend $750 million or more in estimated revenue.
The four candidates running for mayor-president — Holden, Metro Councilman Mike Walker, businessman Gordon Mese and attorney Steve Myers — have different ideas about how those funds should be spent. The four also have distinct proposals for expanding the local economy, which produces tax revenue to pay for government services.
For all the talk of changing the city-parish’s spending priorities, though, the reality is that the mayor-president’s control over the budget is severely limited. The large number of voter-approved dedicated taxes and user fees in the budget takes much of the control out of the hands of the mayor.
In 2012, dedicated funds totaled about $465 million of the parish’s $746 million budget. Once dedicated funds are taken out, the city-parish is left with around $281 million in general funds, from which it must fund a litany of obligations, including law enforcement, fire protection, city and district courts, the mayor’s office and the Metro Council.
For Holden, who is preparing his eighth budget as mayor-president, the budgeting process begins early. The finance department began working on the 2013 budget in the spring.
“We try to keep people held to a rigid standard where they don’t see the budget as a Christmas shopping list,” he said.
Holden said he or members of his administration consult with department heads, the finance department and the police and fire unions before finishing the budget. He bristles at allegations from Walker that the Metro Council isn’t consulted sufficiently in the budgeting process.
“I do not just throw things out, they have to vote on them,” Holden said, noting that the Metro Council has final approval of the proposed budget. “After at least eight years with me, tell me why they haven’t raised hell about the budget process?”
Several council members complained in the fall of 2010 when Holden departed from his past practice and did not provide them with advance briefings before publicly releasing his proposed budget. The following year, the council exercised its rarely used authority to reallocate $800,000 in discretionary spending that historically was controlled by the mayor.
Holden also challenged Walker’s criticism that the city-parish has a “spending priority problem.”
Holden said his spending priorities have never changed since he was elected and he has always made public safety his highest one. The 2012 budget shows that just over half the general fund budget is designated for public safety, which includes money for the police and fire departments, Emergency Medical Services, the Mayor’s Office of Homeland Security and Emergency Preparedness and portions of the Department of Public Works budget.
Holden said the increasing cost of employee benefits and other mandatory expenses put a tight squeeze on the budget.
“There are mandates being put on us that we have to meet or a lot of people are going to suffer,” he said.
Walker said he would collaborate closely with the Metro Council each year by holding monthly budget meetings starting in January of his first term. He noted the council currently only gets to see the budget once a year, in November, and has a month to look at it before making a decision on adopting it.
“We are all waiting with bated breath to see what the mayor is going to come up with,” Walker said, referring to this year’s budget process.
Walker, a Republican, said the city-parish should examine expenditures to see what might be redirected to fighting crime.
e_SDLqYou look at that first and everything else comes second,” Walker said.
Walker said he’s “heard before from people” that $465 million of the budget is dedicated, but “I am not sure whether that much is dedicated funds or not.”
He said a review is warranted regardless.
“Do we have the authority to go back and undedicate any of that money?” Walker asked. “Can we look at it and see how we are spending that money?”
However much of the budget the mayor and council have discretion over, Walker said, spending decisions have to be made every year based on where the needs are greatest. He said he would go through the budget line-by-line as mayor to look for spending cuts.
“That’s where, if you are the mayor, you have control,” Walker said.
Steve Myers, who is running as a no-party candidate, said his approach would be to focus on the “core mission” of local government — public safety and infrastructure.
“If I see a budget item that doesn’t fit in the two main core missions, it gets starred” as an item to be cut, he said.
Myers pointed to several items in the budget that could be cut, including $38,000 for the Downtown Business Association, $843,000 for the Louisiana Art and Science Museum and $21,000 for Louisiana Earth Day. He questioned spending public money for such purposes when ditches need to be cleared and turn signals need to be fixed.
Myers also suggested that the park system or nonprofit organizations could take over some of the community centers as a way to save money and said he would push for fair property tax assessments parishwide to help increase revenue.
No-party candidate Gordon Mese, who owns the Garden District Nursery, said his first budgetary act would be to hire a “real CFO financial guy” to oversee the city-parish finances. He said he will surround himself with an informal set of knowledgeable advisers he can consult with.
Mese said the city-parish needs to make the most of its limited resources.
“We’re not going to be able to throw money at problems,” he said.
The four candidates differ broadly on how best to attract new business and expand both Baton Rouge’s economic footprint and its tax base.
Holden and Mese said the city-parish should focus on diversifying the local economy.
The availability of a wide variety of jobs will allow Baton Rouge to attract talented people to the city and help the city-parish retain the talented people it already has, Holden said.
He pointed to cities such as Pittsburgh that relied on the steel industry to illustrate what can happen when a city becomes too reliant on one economic sector. He noted Pittsburgh had to diversify and is now “viewed as one of the top cities and models for how you rebuild your city from the ruins.”
Holden said a crucial part of his strategy is to go to companies’ home turf and try to convince them to come to Baton Rouge. He cited trips he’s made to the California headquarters of Electronic Arts, a video game company, and to other locales to promote the city as a good place to do business.
He noted the economic payoff to the city-parish from his successful efforts to recruit the U.S. Bowling Congress to hold months-long tournaments in Baton Rouge in 2005 and again in 2012. He also talked about his success in working with the film industry, which has shot several motion pictures in the city in recent years and has generated jobs and revenue for the city. The film business in Louisiana has been aided by a generous state tax break.
Holden said that recruiting must extend outside of the nation’s borders.
“You have to do the international recruiting to get companies from overseas to come and locate in Baton Rouge or utilize (local) companies,” he said.
Holden’s international travel during his tenure as mayor has included two trips each to China and Taiwan and travel to Turkey and Israel, paid for with campaign funds or by the host countries or entities acting on their behalf.
His well-publicized trips to China led to announcements that one Chinese company planned to build a plant here manufacturing a radiation treatment device and that another was looking to establish a hub in Baton Rouge to produce light-emitting diodes, or LEDs. Neither has come to fruition yet.
Holden said in a recent interview that he’s targeting a Chinese company that manufactures big-screen televisions for LG and Panasonic to come to Baton Rouge.
While Holden looks well beyond the city-parish’s borders for economic development, Walker said the city-parish should focus on jobs in the oil, gas, and petrochemical industries.
“I call these bread-and-butter jobs,” he said.
Walker said the oil and gas industry has “always been here, it always will be here and what’s under the land will always be of benefit to those above the land.”
He brushed off concerns that an emphasis on one economic sector puts the city-parish’s economy at the whim of volatile markets, saying that the markets are strong and that even in down times plants and industries along the Mississippi River have survived.
A report issued Wednesday by Loren Scott, a retired LSU economics professor, and Jim Richardson, the John Rhea Alumni Professor of Economics at LSU, said the Baton Rouge area could add 9,000 jobs over the next two years, mainly due to a booming petrochemical industry.
Jobs at those plants are “permanent jobs with good benefits and once you get one of those jobs, it will benefit you and your family until you get ready to retire,” Walker said.
He said that by contrast, the types of jobs Holden touts in the film and digital industries are “sugar highs.”
Walker also said the perception that crime is rampant in East Baton Rouge Parish is causing businesses to move out of the parish.
For example, Walker said, Superior Steel “moved to Livingston Parish because they got tired of getting robbed all the time.”
Superior Steel President and General Manager Joseph Easley Sr, said he wasn’t happy about crime in the area of the plant, but it wasn’t the major impetus for the decision to move. He said the company “bought a piece of property that’s more compatible with what we are trying to accomplish.”
Businessman Gordon Mese, who is running as a no-party candidate, agreed with Holden’s approach to diversifying the economy.
Mese said the economy increasingly revolves around “intellectual property,” which means the location of where work is performed takes on less importance.
“A city or municipality that’s going to win in the future is going to be the municipality that actually builds the place that someone wants to live in,” Mese said. Creating a city that is attractive to “young, creative types” will attract companies to Baton Rouge, he said.
Myers said economic development should be left to area chambers of commerce and private businesses.
“I am not one that believes that the city-parish government should have a huge role in economic development,” he said. “I think it’s something they need to be aware of and work with businesses.”