Tulsa City Councilor Pushing Rainy Day Fund

Wednesday, October 20th 2010, 2:31 pm
By: News On 6

By Emory Bryan, The News on 6

TULSA, Oklahoma -- The City of Tulsa may set up a "rainy day fund" to save cash for down years - but first, voters would have to approve.

The city practically spends every dime it gets every year - even in really good years - then in bad years, it has to make fast and deep cuts.

Voters have a chance to change that. The proposal is a charter change that will appear on a ballot in the City of Tulsa Tuesday, November 2, 2010.

Read the Proposed Charter Amendment

Tulsa City Councilor G.T. Bynum is not only leading the campaign, he is the campaign for the rainy day fund, an issue that has no organized opposition - but no campaign of support either. The basic idea is to level out the ups and downs of city income and spending - with a savings account.

That's a novel idea at city hall.

"The city has felt an obligation to spend every dime that's come in; we haven't set anything aside year to year," Bynum said.

The downturn of the last year resulted in major cuts to the Tulsa Fire Department - and a large but temporary layoff for Tulsa Police. Both could have been avoided if the city had money in savings.

City hall budgets for a 5% reserve - but has seen sales tax drop by much more year to year. Bynum says the problem isn't the amount of sales tax - it's that the city spends every penny - even when sales tax goes way up.

See Councilor Bynum's Presentation

The reserve fund would divert some sales tax income into savings when revenue collections are up. When it's down - the city could draw out of it - and use the money to level out spending.

The idea to create the reserve fund - and make it part of the charter so it can't be easily changed - is one issue on which the city council and the mayor agree. It could defuse a lot of the arguments at city hall - which usually involve the budget.

"In times of economic difficulty you have a pool of money to help you ride out those valleys if you will," Bynum said.

The rainy day fund will be on the ballot November 2. If it's created, the city wouldn't start putting money into it until the budget gets back to where it was a couple of years ago - before all the cuts.

The city would start creating the fund after general fund revenues top $250 million. Afterward spending would be limited to a 4% growth rate, with the extra set aside for the fund.

The reserve fund plan has the backing of the council and administration.

Learn more about the Rainy Day Fund