For the week of September 10 - 16, 2003

Prudence,
where art thou?

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The Ketchum city council majority apparently hasn’t been impressed by news out of Boise, out of virtually every other state capital and out of Washington.

It seems to be common knowledge, except in Ketchum city hall chambers, that federal and local governments erred grievously when they wiped out healthy treasury surpluses by willy-nilly ignoring alarms about a drastically sinking economy and spending as usual.

So, apparently functioning in a vacuum, Ketchum has tentatively adopted a $14.1 million operating budget that is $527,000 larger than projected revenues.

And true to the disastrous experiences elsewhere, Ketchum has dipped into reserves for the $527,000 difference, reducing the reserve fund to a reported $500,000 for emergencies.

If Ketchum political leadership’s economic crystal ball is revealing something rosy about the future, they should share it with the nation and economists who’re not so ecstatically optimistic. Ketchum is conducting the city’s economic affairs as if good times are just ahead and revenues will flow like milk and honey.

The reality, however, is the continuing rise in joblessness around the nation, the deepening federal deficit, the soaring costs of the war in Iraq and the continuing uncertainty in consumer spending leaves an enormous question mark over the economic well-being of resort communities such as Ketchum.

How so? Ketchum’s city budget relies heavily on local option taxes--sales taxes, if you will--on resort business. If visitor volume sinks, so too, does the city’s revenue.

And if it sinks more than anticipated, and the city needs emergency funds, then the remaining rainy day reserves will be wiped out--and then the painful process would begin, as it did for Idaho’s Gov. Dirk Kempthorne and the state Legislature, to cut public programs and services.

Ketchum’s rush to slather pay raises and generous health benefits on employees during such dicey economic times is as much a disservice to the city’s workers as to taxpayers. In due course, city workers would more than likely put a higher value on just having a job than raises that might cut so deeply into city finances that cutbacks would be the only option.

Furthermore, the Ketchum budget is little more than an expensive caretaker package. What of long-discussed and inevitably delayed initiatives on parking, street repairs, valley bus service, and building out the city’s sidewalks?

Sadly, prudence was another victim in the new Ketchum city budget.

 

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