Atlanta: An Example for Desperate Localities

Yes, Shirley Franklin may be a Democrat but the extent to which she has gone to turn Atlanta's bleak fiscal position around is impressive. Last year, as she took office, she learned that she was inheriting a $90 million deficit (20 percent of the city's operating budget). By last month, that deficit has been turned into a surplus of $47 million.

The mystery of the sucess lies largely in her reorganization of City Hall, which consequently saw a 16 percent reduction in its workforce. This was the first step in correcting what had become a bloated bureaucracy (Atlanta employed 21% to 37% more city workers per resident than the average city government), as former-Mayor Bill Cambell must have taken a few pages out of the Marion Barry playbook -- to gain votes, Cambell would just create jobs in City Hall for his prospective voters. Cambell's corruption extended far beyond his jobs-for-votes campaign: Corruption scandals on his watch led to convictions of a former city chief operating officer, deputy chief operating officer and commissioner of administrative services. Clearly, Franklin appears to be a breath of fresh air for Atlanta. But it's still early.

Come time for re-election, it may be difficult for Franklin to court the same people who got her the title of Atlanta's first female mayor. Fortunately for her, she has impressed a whole new group of voters -- businessmen who doubted she had it in her to cut the fat in City Hall.

Once Franklin was inaugurated, her advisors were telling her that the answer to their fiscal problems was in a property tax increase of 47 percent. But in order for that to fly, she would have to court the business community, which initially questioned her intentions (she is a Democrat, afterall). Assuming Franklin was just another tax-and-spend mayor, they wanted evidence that it wasn't just the taxpayers who were going to experience some belt-tightening. Then, they'd consent to the tax increase. The city council cut 846 of 5,407 jobs as well as implement an unpaid furlough policy (employees must take off five days unpaid) and cut low-priority services from the budget (grass trimming around signs was one of the first to go).

In the end, I think the property tax increase was a little rough (the city council ended up raising the rate 51 percent instead of Franklin's request of 47 percent), given as how they still had a $5 million surplus from just reorganizing City Hall. If anything, Shirley Franklin is impressive because she made the cuts and decisions (it's never easy to upset your own voting block) that scare the hell out of every state and local government that right now is riding the deficit express.