City Budget & Finance

City Budget & Finance

Third-Party, Independent Financial Audit. Over the past three years, City revenues have increased by $450 million, yet spending has increased by $570 million. Are services any better? No. Are the streets better? No. Do we have more police on the streets? No. We have to get a handle on spending in the city. When I am mayor, we will have a third-party, independent audit of the budget. This audit will include the budgets of all TIRZ’s, Enterprise and other dedicated funds, as well as the General fund.

Process Audits. We must ensure that the way we perform city functions is the most efficient and productive way. I will encourage subject matter experts to assist me for the good of the city (free of cost) in performing process audits of every single department. Can you imagine how we could improve the way we do permitting or the way we repair potholes? Through process audits, we will be looking for ways we can do things more efficiently and for duplications and ways to save. Moreover, through such audits, every department and every position will be carefully analyzed to ensure it serves the residents in an efficient manner.

Zero-Based Budgeting. Houston needs a mayor who knows how to effectively deploy resources and get the absolute most for our public dollars.  We must be more efficient. Because I’m not taking campaign donations and am not actively seeking endorsements, I will have the freedom to do what is necessary to ensure we provide core services and also balance the budget. All too often, a candidate promises to do something but does not follow through once in office because it is contrary to his/her campaign donors’ interests or to those who endorsed him/her. Not me. And, too often politicians and government bureaucrats complain that they don’t have enough money for core city services yet they have no problem finding money for a pet project – or worse – they give multi-million dollar contracts to their friends, donors, or former partners.

I’ve overseen big budgets as a Texas A&M Regent. I’ve learned all the tricks of how large government organizations spend money. As chair of the audit committee, I oversaw the processes and budgets of 11 universities and 7 state agencies. I know where to find the inefficiencies and wasted monies. As the owner of a large, successful law firm, I know how to hire, train, motivate and manage employees. I’ve owned shopping centers and apartment complexes, and I know about capital projects, permitting, construction, and renovation. I’ve built retail businesses from the ground up, staffed them and sold them. Over the years, I’ve come to understand budgets, management, and how to keep a business going and make it successful. For every expenditure, I’ve learned to ask “why,” and if we can do it for less. And, the most important thing I’ve learned is to surround myself with smart budget experts and verify their recommendations. I won’t have all the answers myself, but I do know how to find the answers.

Every bureaucracy will spend every available dollar—it’s the nature of government. I think we can do better. I believe in zero-based or performance-based budgeting; that means deciding how much money we need to provide services, rather than deciding how much we have and then deciding how to spend it. I will only put in place department heads that believe in zero- based budgeting, period. I also believe we can provide all the services our residents expect but be efficient. Additionally, I will be looking to save taxpayer dollars. As a Marine, I learned to do more with less. That’s the type of mayor I will be. When I’m mayor, everything will be on the table. Let’s provide effective and timely service, all with an eye to saving taxpayer money. That’s what I’m about.

Transparency. One of the issues that constantly comes up in Houston is the complete lack of transparency at City Hall. We should know where every penny is spent. When I’m mayor, we will have metrics that every resident can review, to see how the city is doing in real time. And, we will make every department transparent–everyone should be able to see what is being spent, what it is being spent on, and how we are performing.  

Ending TIRZs and making Enterprise Funds and remaining TIRZs pay their share of city services. Typically, when the city budget is discussed, it is done so in terms of the General Fund. The General Fund makes up a fraction of the overall budget. On a wider scale, we have to get a handle on how money is being spent in the Enterprise funds, dedicated funds and the TIRZ’s. As my campaign continues, I will propose ways to monetize and charge the enterprise funds[1] and TIRZs for their fair share of city services. I believe we could realize tens of millions for the City. These monies could be used to make sure the under-served areas of the city are receiving adequate services. Further, as the campaign continues, I will be rolling out a proposal calling for the “sun setting” of those TIRZs that have run their course and no longer meet the purpose of their creation.

Other ideas:

5% minimum with a 10% goal for cuts in the following departments, with no corresponding layoffs:

  1. Parks ($43 million budget/700 employees);
  2. Library ($37 million budget/467 employees);
  3. Health Department ($37 million budget/402 employees);
  4. Neighborhoods ($9 million budget/110 employees);
  5. Administration ($15 million budget/191 employees);
  6. Controller ($7.4 million budget/60 employees);
  7. Council ($7 million budget/82 employees);
  8. Finance ($13.5 million budget/110 employees);
  9. IT ($12 million budget/100 employees);
  10. Human Resources ($2 million budget/21 employees);
  11. Business Opportunity ($3 million budget/35 employees);

25% cuts in the following departments:

  1. Legal ($14.5 million budget/110 employees);
  2. Mayor’s Office ($5 million budget/42 employees);
  • Eighteen-month hiring freeze, with the exception of public safety professionals.
  • Outside review and elimination of unnecessary perks.
  • Outside review of any incentives or abatements to be sure those that received them are living up to the bargain.
  • Outside review of recycling program and waste removal; initiate process to move to one-bin concept.
  • Begin to aggressively pay down debt ($392 million per year in budget for debt service) through a comprehensive plan, to improve the City’s financial rating as well as reduce payments going forward.
  • Transition of the Permitting Function from a general fund operation to a fee-for-service enterprise fund. Currently, the Permitting Department is not only an expense of the City, but it is also a detriment to the growth of the City and its tax base. The reality is that the Permitting Department (which is part of the Public Works Department) performs very poorly – its operations are slow, its processes confusing, and its results uncertain. From city data, it appears that the permitting function generates approximately $66 million in annual revenues and spends approximately $33 million on annual salaries and benefits. After study, I may propose that the Permitting Department be converted to a fee for service operation and that permitting fees be increased – perhaps doubled.   In exchange for these increased fees, property owners and their architects, engineers, and contractors that apply for permits, are promised prompt and certain processing. The way to handle this is for the Permitting Department to retain the services of external architects, engineers and other qualified professionals to work for professional fees (not salaries) to evaluate projects and their plans according to City requirements and codes (thus maintaining technical standards for approval and removing temptation for inappropriate behavior).[2]
  • Third party aggressive collections of ambulance fees.
  • Revamp permitting process of the Fire Marshall’s Office.
  • Accelerated Foreclosure of Abandoned Properties for Delinquent Taxes and Assembly of Parcels into A City Land Bank for Re-Sale to Real Estate Developers. This will be a major initiative offering large amounts of new revenue (from the foreclosure and then sale of properties from delinquent taxes), and also improved re-use of land in under-served neighborhoods (cleaning up dangerous properties and selling cleaned up land back into the private market for redevelopment of new projects). This offers substantial cash generation potential from the parcels directly involved in the new, accelerated program, but more importantly from the increase in property tax base created by neighborhood clean-up and new development activity stimulated.  


[1] The Aviation Enterprise Fund has a $519 million budget. This is the fund responsible for the $85 million building at the airport that should have only cost $11 million. The Convention and Entertainment Fund has a budget of over $100 million. The Dedicated Drainage and Street Renewal budget is $275 million, yet our streets aren’t any better. Millions upon millions of dollars are being spent without council or mayoral oversight. I believe there are significant savings that could be realized with proper oversight of these funds.

[2] It has been shown that in other cities, such as San Francisco and New York, developers and their teams will pay increased fees in exchange for quality service, speedy processing and professional reviews (including suggestions for improved designs).   And, the Fire Marshall inspections can be coordinated with the Permitting Department. If the Permitting function does indeed become a fee for service operation and all expenses associated with the department will be covered by the permitting fees charged to its customers (like landing fees paid by airlines to finance operations of the airport), then the salaries currently consumed by the department’s employees could be returned to the General Fund as savings – say, approximately $33 million. This same idea could also generate millions in revenue through the Fire Marshall’s office, while at the same time providing prompt and predictable service.