Rate hikes, tax hikes
The city takes $ from Austin Energy to balance the budget.
Correction: Yesterday I wrote that the firefighters association voted 85% in favor of a no-confidence resolution on Chief Joel Baker. In fact, it was 93% in favor. Somehow I misheard union president Bob Nicks when he told me the figures.
Yesterday I described three ways that City Manager T.C. Broadnax is closing a $33 million shortfall the city faces in the upcoming fiscal year. But there is a fourth thing he is doing that is even more important than the other three, but which the city appears less interested in spotlighting –– which helps explain why I initially neglected it.
The proposed budget increases the Austin Energy General Fund Transfer by $14 million –– to $139 million.
The GFT is a funny thing. In theory it mimics both the taxes and fees that a private utility would pay to a local government, as well as the dividends it would pay to its shareholders. In the case of a city-owned utility, the "shareholders" are the citizens.
(Austin Water also has a GFT that Broadnax has proposed increasing by $2.5M to $58M)
The problem is that dividends are typically paid out of profits and right now Austin Energy is not profitable.
