Damage Control Only

I was listening to the Exchange on NHPR on Monday, where they were talking about the state’s budget challenges. One of the guests, Steve Norton from the New Hampshire Center for Public Policy Studies, commented that the state budget was essentially in crisis mode, trying to keep things moving until next year when they might be able to make some long-term decisions if the economic situation improved. This year, he said, was just stopgap measures to keep the ship afloat.

That, unfortunately, is where Berlin is as well, and its easy to see where it leads.

The school department laid off 10 teachers last week. They had to make the cuts in order to keep their budget flat, which the council requested/mandated. That’s 10 middle class, upstanding residents that will be out of work unless something changes.

The school department is a big employer in Berlin. Like the hospital, the prison and numerous other social service agencies around the city, it does not contribute to the tax base, but it contributes jobs. The city is in the position where it needs to slash funding for fire fighters, teachers and possibly police officers, but these cuts simply mean the city loses a few more upstanding residents.

Councilor Danderson often comments that the good people are leaving. What can the city do to stop it? Not eliminating their job would be one way, but then the expense falls on everyone else.

The goal of keeping the tax rate flat is important, as Berlin already taxes higher than most of the rest of the state. But when does keeping it flat become too much of a risk? When the city starts speeding up the very exodus it is trying to prevent it may just be time to start reevaluating.

Now I say this without being a property owner. Because New Hampshire doesn’t have an income or sales tax I largely escape the impact of the state’s taxes, and I completely escape the impact of Berlin’s. But the city can’t support vital services it needs, and because of it they lose twice. First, there are fewer teachers, so class size goes up, and second, those teachers move away to find work somewhere else. Heck, they may even lose a third time: the teacher sells the house they had bought and stop paying taxes on it. It may wind up just one more vacant building.

The council, however, doesn’t have much choice; no one wants to squeeze an extra $1 million out of Berlin residents. But somehow the city has to find a balance between fiscal prudence and maintaining adequate services. No one will move there if the fire department can’t respond or their kids get a poor education.

Up to now city departments survived with meager resources, and they have done the job well. But the accounts I’ve heard is that this year budgets are too tight to keep shaving the dollars off. Something has got to give. It’s either jobs or taxes, and no one wants to give up either. It’s a terrible choice, and I wouldn’t want to have to make it.

People need go to council meetings and voice their opinions. Is it worse to raise taxes or to lose services and people? They aren’t my taxes, so I can’t say, and they aren’t my services either. Where I live there aren’t city level services, so I have no idea what is a fair price for such things. The people who pay for and use the services need to tell the council how they feel, and what direction they want to see these two things go. Too often people comment on the budget only during the public hearing, when everything is set, finalized and printed. They make changes at this point, but only minor ones. If people want a major change in policy they have to speak up early.

But maybe they don’t. Maybe, like some people have said, Berlin should essentially become a town and forget about maintaining city-level services. The city has the population for it, maybe it would work. I’m not sure who would watch over the excess infrastructure, but that would be a problem for another day.

A city may be like a business, however: if you aren’t growing you’re failing. Berlin isn’t growing right now, and turning into a town or cutting jobs doesn’t help. They need growth, certainly, but the question is what decisions this budget cycle will best spur such growth, maintaining taxes and cutting services or raising taxes and maintaining services? What will do more good over the long-term? At this point, the city is writing a budget based on damage control. For a shot at a future, however, the city needs to take deliberate action. Hopefully they are fully invested, one way or the other.

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