The season to be jolly is over now, right? At the end of this year, I had a big awakening, and, no, it was not from a nap. True, I’ve been at this an awfully long time to be having awakenings just now, but this has to do more with events, less with me.
Maybe the only thing we achieve with an advance in democracy is a more democratically selected group of people to cook the books for us. Call me a slow student. I really didn’t see that one coming.
For one thing, the problem can seem so simple. It’s receipts. If Dallas City Hall simply were able to collect proper receipts for the $3 billion a year it spends and hands out, none of the great catastrophes of the last year would have taken place.
Take, for example, the Dallas Police and Fire Pension Fund debacle. Here, I guess I am expanding the concept of simple receipts to include standard bookkeeping and general due diligence.
Years ago, maybe a decade, if City Hall had been regularly poring over the pension fund’s books — if there had been good books to pore over — none of this year’s pension fund catastrophe would have happened. The very early stages of the bleeding would have been right there, on the page and in the numbers. X is the amount we have to pay. X-minus-Y is the amount we have in the bank. Not enough.
Instead, City Hall somehow allowed the pension fund to drift onto the rocks, creating a harmful civil and political emergency, and the city never could untangle its own pension mess. We had to go to the Texas Legislature to get it fixed.
That’s only one example. Now, the federal government has a full-time team of investigative gumshoes occupying semipermanent office space at City Hall — they have parking passes! — looking for receipts for what may be hundreds of millions of dollars in money distributed to the city by the U.S. Department of Housing and Urban Development.
That’s all about receipts. Most of the media insist on reporting that story as if the amount missing in federal funds were $29.9 million, but that number is the tip of the iceberg. That number comes from a sample audit by Dallas City Auditor Craig Kinton, City Hall’s one honest man, meaning $29.9 million is where he stopped counting.
At that point, Kinton had looked at only 10 percent of the funds in question. So ultimately, when it all gets toted up by the gumshoes, we could be facing something more in the neighborhood of $300 million for which the city lacks receipts.
For as long as I can remember, City Hall has barely asked for receipts, and when it did, it backed off the instant there was resistance. It was as if asking for receipts was rude.
I know of multiple instances in which it was suggested that asking for receipts was racist, but do not take that as a dog-whistle to suggest that this is a race-specific problem. If you want to see vast sums of tax money that have sailed off into the ether, take a hard look at the tax incentives gifted to major developers in North Dallas. In fact, maybe it is racist to ask black people in southern Dallas for receipts if you don’t also make the rich white guys in North Dallas cough up some decent accounting.
Kinton has uncovered an appalling absence of simple financial diligence in department after department. Ask yourself how and why Dallas City Hall, an entity with a $3 billion annual budget, developed a culture with such an absence of regard for proper bookkeeping.
Here’s at least a part of it. If elected officials know what the numbers are and if the numbers are not good, the officials have to respond. If they don’t know, they can do what they want.
Bad numbers require elected officials to utter that one absolute and most-reviled obscenity in all politics: no. No, we’re not going to give you a $20 million tax break on this project because you still haven’t shown us the book work on the last multimillion-dollar tax break we gave you.
No, we’re not going to give you a grant for your outreach project because the due diligence on that type of project shows it’s a total waste of money bordering on a scam.
No, we’re not going to back off our demand that you show us what you did with the money we already gave you, and if you continue to fail to do so, you may wind up talking to the DA.
Here is where I have been a slow student. I have always blamed this problem on class and privilege. For decades, Dallas city government was a close insider’s game. All the real politics and deal-making happened off campus and behind closed doors at places like the private Dallas Citizens Council and in opulent clubs and mansions.
The cake was baked long before it got to City Hall, and the last thing elected officials or city staff wanted to do was get in the way. No one wanted to look at the books. They liked it better when there were no books.
In recent years, Dallas City Hall has seen a welcome and refreshing growth in both democracy and basic fair play, with a recognition that resources need to be shared more equally throughout the city. But at the end of this year, I realized that fair play hasn’t made a dent in receipts. Things may even be worse.
The specific instance that woke me up was a City Council debate over a special system of tax breaks — giveaways to real estate developers from the city’s general fund — called tax increment financing. The city had already given away so much of this kind of money that it was in violation of the limit it had set for itself.
The districts in question are special places where developers don’t have to pay regular property taxes on time every year like everybody else. The existing rule was that the City Council could not create any new giveaway districts if the total number of districts already in existence exceeded more than 10 percent of the total taxable property in the city.
You can see that, right? The city needs to hang on to its tax base in order to fix the potholes and buy new firetrucks. It can’t just give away the farm.
Say you’re a potato farmer, and you have a lot of cousins who would like to grow their potatoes on your farm. You tell everybody, “OK, but no more cousins on my farm if the total amount of acreage under cultivation by cousins will exceed 10 percent of the whole farm.” Fair enough?
The problem Dec. 13 was that the City Council wanted to give away some more tax base. They had a guy they liked. The white North Dallas council members called him a “splendid developer.” The black southern Dallas Council members liked him because he was going to build a development their part of town.
Everybody had a reason, but there was a rule. Ten percent. And they were already in violation of it. So that’s easy. They voted to change the 10 percent to 15 percent.
One council member of the 15 — one — voted against the change. Scott Griggs of District 1 in North Oak Cliff insisted the city should not blithely vote to increase the amount of tax base it gives away without first making an effort to see how the change would affect the rest of the city’s budget — the potholes, the firetrucks, all of the things the city never seems to be able to attend to, even in good times.
Griggs was roundly and soundly ignored. The rest of them, led by the mayor, voted to increase the giveaways to 15 percent of the total tax base. Everybody but Griggs was happy. They figure this is the kind of technical stuff the voters will never comprehend anyway.
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
I was watching our new city manager and his top staff, who have been making a lot of noise about bringing more rigor to the financial system at City Hall. They sat on their hands through the whole debate. And, after all, they are hired hands. They can count the votes. They’re not going to last long if they tell 14 of the 15 votes on the council that they are irresponsible.
It’s not that the old guard was not greedy and self-serving in the way it ran City Hall. Its system of accounting was to sit on the money with a shovel and say, “One for you, one for me, one for you, one for me.”
Now, we have more people with shovels, but on Dec. 13, we still had only guy who could say, no, stop shoveling. Count the money. See what we have left. Add up what we have to do with it. Find out where we stand. One guy.
So there is my great discovery for 2017. Democracy, the leveling of the playing field, the throwing open of the gates — all this has accomplished one thing so far at City Hall. A more diverse slice of the citizenry, selected with a greater sense of fair play and drawing on a wider variety of experience and background, can now jam its mitts into the cookie jar. Remember that next time a pothole knocks your hubcap off.