Over the past 15 years, the City’s total Public Safety costs have grown faster than the City’s General Fund revenues. This is a critical financial problem that needs to be addressed now to balance future budgets and to secure the City’s long-term financial stability.
Public Safety is a priority city service. We highly respect and are grateful for our public safety officers. Since 2006, the City has added 477 new police officer and fire fighter positions, 2 new fire stations, 7 replacement fire stations, a new public safety headquarters, a new computer aided dispatch system, and replaced more than 30 EMS units, over 30 fire engines, and more than 10 fire ladder trucks. Since 2006, the City has eliminated a net 1,242 civilian positions resulting in fewer City positions today than in 2005.
City Budget The City’s consolidated budget of $2.3 billion is comprised of an operating budget of $1.68 billion and a capital budget of $570 million. Of the total operating budget, the General Fund is $988 million, 67% of which is allocated to police and fire expense.
A 13-member Healthcare and Retirement Benefits Task Force was appointed by the Mayor and Council in the fall of 2013 to study healthcare and pension and provide short term and long term recommendations to reduce cost. Findings and recommendations from the Task Force include:
Public Safety Expenses The Task Force recognizes that Public Safety Expenses have grown faster than the General Fund revenues. It recommends that the City Council establish policies that assure Public Safety budgets are managed in balance with other City services and General Fund Revenues.
- According to an independent actuary, if public safety costs continue to grow at a faster pace than general fund revenues, they could consume 100% of the total general fund by 2040 or as soon as 2024, just 10 years from now. One alternative is to increase the City’s property tax rate. However, the needed increase would almost double the City property tax rate by 2040 from 56 cents today to over 1 dollar. The City property tax rate has not been increased in more than 20 years.
Healthcare The Task Force conclusions are that uniformed healthcare benefits are richer by a large margin than civilian employees, as compared to peer cities in Texas, and compared to private employers in San Antonio. The Task Force recommends that the uniform healthcare benefit and contribution levels be more closely aligned with civilians, other peer cities, and public and private employers.
- San Antonio spends $19,122 per uniform employee to provide healthcare benefits. This is 2 ½ times higher than the cost of a civilian employee; and it is the highest among all major Texas cities.
- Austin, Houston, Ft Worth and Dallas provide the same or similar healthcare plans to Uniform and Civilian employees.
- San Antonio is the only major Texas City where Uniform employees pay no healthcare premiums for dependents and families, and deductibles and out-of-pocket costs are among the lowest.
- Last year, Uniform employees paid approximately 9% of their total healthcare expenses and Civilian employees paid 30%. In Austin, both Uniform and Civilian employees paid 36% of total healthcare expenses. The national average for employee expense is 43%.
Pre-Paid Uniform Retiree Healthcare and Pension The Task Force recommends that the City continue to study Pension and Pre-paid healthcare to develop alternatives that will save the City money in the long term.
- San Antonio is the only major Texas City that pre-funds the cost of retiree healthcare for current active employees. The City spends $27 million annually in pre-funding retiree healthcare and $75 Million annually in Pension.
Conclusion Public Safety is a top priority of the City of San Antonio. Maintaining a reasonable healthy financial balance between public safety services and other important city services is our responsibility.
- Uniform wages in San Antonio are highly competitive among major Texas cities; however, uniform healthcare benefits are richer by a large margin than civilian employees, peer cities in Texas and private employers in San Antonio.
- Cities and states across the nation are addressing employee benefit costs to manage the rising cost of healthcare expenses.
- To keep the City of San Antonio fiscally strong for the long term, change is needed.