Bites bows to math
Bites is no financial genius. That should be obvious, given that Bites is writing a political column in an alternative weekly newspaper—instead of, you know, driving a bus, or cooking up biker crank in a bathtub or working for the Bee.
But Bites has just enough learnin’ to know when something doesn’t add up. Take the campaign statement sent out by the Kevin Johnson mayoral campaign the day that City Hall released its proposed 2008–2009 city budget.
“We are troubled that—on the day the budget was put out—Mayor Fargo failed to come out and explain to Sacramentans why we have a $58 million shortfall,” reads the statement.
Sure, Fargo was at a televised debate the next day, talking about the budget deficit along with the other candidates—with the notable exception of Johnson, who was out of town that day according to his campaign staff.
Sure, she had been talking about the budget and the budget deficit in a number of community forums around town, along with the other candidates—except Kevin Johnson. Sure, she’s agreed to meet reporters and talk about the budget and other issues whenever asked (see “On the record,” a lengthy discussion with Fargo, on page 13 or the expanded version on our Web site).
But, according to the perhaps unintentionally ironic statement on the budget from Camp K.J., “Fargo has gone into hiding.”
Come to think of it, maybe she should hide. There’s no doubt the budget situation is grim. And as the mayor, Fargo is where the buck stops.
The city’s proposed general fund budget for ‘08–'09 is $420.3 million. The general fund deficit for the same period is $58 million.
Now, stand back and check out the fourth-grade math skills. Divide the deficit by the budget and you get 0.1379. In other words, the shortfall is equal to about 14 percent of the total general fund budget. That’s huge.
Surely, Kevin Johnson can do better. It says so right on his campaign Web site. “As CEO of St. Hope Academy, I’ve grown businesses, met payrolls and balanced budgets with a disciplined approach that can be applied to government.”
St. Hope Academy and the St. Hope Academy Foundation are nonprofits, so they have to file what is called a Form 990 every year with the IRS. Like most of the St. Hope entities, they’ve been mostly in the red for several years. In 2005, the academy managed a nearly $450,000 surplus. It was wiped out in 2006, owing $650,000 more than it took in from government grants and other sources.
In 2006, the most recent information available, the combined expenses for St. Hope Academy and the St. Hope Academy Foundation were $2,141,394. The combined deficit was $705,565. A little more long-division, and you find the deficit is about 33 percent. In other words, St. Hope’s budget was more than twice as whacked-out as the city’s.
Yes, yes, Bites knows it’s not an apples-to-apples comparison. It’s more like apples to cornfields. The two organizations are vastly different in size, scope, structure and mission.
St. Hope’s current executive director, Rick Maya, says it would be great to be back in the black, but that’s not as important as the organization’s mission.
“It just costs more to get the desired results than what we’re currently funded at.”
Not unlike, Bites supposes, putting cops on the street, fixing roads or helping the homeless. But any nonprofit, be it a city or a school, has to take in at least as much as it spends to be sustainable.
So let’s assume, just for the sake of argument, that Fargo and Johnson are each equally responsible for the financial health of the organizations they lead—him as CEO, her as mayor.
According to Johnson’s Web site, he believes that “When it comes to the city’s budget, the mayor must have an unwavering commitment to fiscal discipline and accountability.” Well, Bites couldn’t have said it better.