re: no exit
Budget season has heated up, and I'm finding that virtually no one thinks that annual above-inflation spending increases are unsustainable.
The union contract requires something in the neighborhood of a 4% increase in total compensation every year. (Employee salaries make up approximately 80% of the total budget.)
Meanwhile the tax cap requires us to hold spending increases to inflation, which is 2%.
The only way to stay within the cap is to cut jobs.
It's obvious to everyone that you can't cut jobs forever, but it's not obvious to everyone that you can't increase taxes above the rate of inflation forever.
Frankly, I'm confused myself.
There's no way out, right?
If you have permanent above-inflation spending increases while taxpayers aren't having concomitant above-inflation increases in their own incomes, eventually you run out of money, right?
Same for cutting jobs. Each year individual compensation goes up 4%, so you cut enough positions to average out at a 2% increase overall. (This year we need to cut 10 FTEs - "full-time equivalents" - to stay within the cap.) But you're not done. The next year individual compensation goes up by 4% again, so you have to cut more positions to average out at a 2% increase overall.
Am I figuring this wrong?
I know only two people who see things this way.
As far as I can tell, the only answer that makes mathematical sense is to persuade the union to agree to a contract that stays within inflation.
Or am I missing something?