Ockham’s Razor, as critics of the concept point out, can be equivalent to establishing the parameters of reality first, and then trying to stuff reality into it.
As the record-setting economic downturn that began in 2008 continues to bedevil the finances of governments worldwide, on the local level in the U.S., revenue shortfalls are testing the resilience of basic services to degrees not seen before.
Few have taken a harder hit than the City of Falls Church, which because of it inordinate dependence on residential real estate taxes to begin with, saw a precipitous drop in tax revenues due to a trend of sharp declines in assessments, a trend that is projected to continue. On top of that, the small jurisdiction took a body blow from a hostile neighboring jurisdiction when the Fairfax Water System sued and not only won, but was backed by a judge willing to compel Falls Church to pay out almost $7 million (in the context of a $66 million annual budget).
State and federal support funds are drying up, there is no new federal stimulus, and Falls Church, which has been sustained – including with buoyed real estate values – on the reputation of its school system, is now looking down the barrel at drastic cuts in the quality of its educational product.
To set the stage for this veritable bloodbath, the Falls Church City Council this Monday voted unanimously to adopt an “Ockham’s Razor” approach to its next budget, giving the City Manager budget “direction” that locates reality in a concept of fiscally prudent practices (from Wall Street’s perspective) and leaves any realities outside that defining concept hanging out to dry.
While going to all the pains to insist that the “guidance” adopted Monday was not “written in stone,” still the process set up what many on the Council hope will be a stone-like artifice to protect real estate tax rates and the City’s fund balance against any actual needs by the school system or other services for more resources in the upcoming budget.
When you hold the tax rate to a four-cent increase (aimed at deriving the same net revenue next year as this) and commit to a systematic restoration of the fund balance to a minimum of eight percent of the annual operating budget, then you are establishing that everything else is subordinate.
According to the math done Monday night, those parameters mean that even with no salary increases on the City side and no increase in the School Board budget, the City will still be half a million short of breakeven.
But increases in school enrollment, driving the need for more revenues, are already known. To hold the school budget to a zero increase is already known to be unattainable. The only way that the City Council’s use of Ockham’s razor will work is with the deepest assault on basic school needs the City has ever experienced.