A number of people have written me to ask about why the status quo cost of City government is currently 6-7% a year. I had a similar question when I learned this during the last budget. The short answer is that most City costs are employee related (schools and city staff) and health care is rising in double digits and has been for some time. The City, as is the private sector, is working to get those health care costs under control, but as you know, health care is a difficult beast to tame. In addition, unfunded mandates from the Feds and the State force us to increase spending every year on a range of service. As the costs to live in this area increase, it also becomes harder and harder to hire staff at a government salary -- we have about 9 percent employee turnover a year and that also creates costs for us. And finally, a number of city services require cars/trucks as well as equipment and the costs of gas and other construction materials are increasing faster than inflation. There is more to it, but those are the major drivers of that 6-7% figure.

In the last budget Councilman Smedberg and I asked that we start a process of performance audits and benchmark setting for every City department. This will begin next year and will lead to a once a year, detailed review of City departments. My hope is we can create a permanent habit of taking a very detailed look at a few departments a year with the goal of finding ways to do things more efficiently, improving programs that work and discarding the programs that don't work or are no longer priorities.