Mayor Phil Gordon Begging for Bailout Money

The Associated Press is reporting that Mayor Phil Gordon of Phoenix has submitted a letter requesting federal assistance for the City of Phoenix.

According to the report, “Phoenix’s budget deficit is at least $200 million and could reach $250 million by June if tax revenues keep sliding. The figure represents up to 22 percent of the city’s $1.2 billion general fund, which pays for most city services.”

Mayor Gordon is one of three mayors requesting loans to pay pension costs in addition to $50 million for investment in infrastructure and one year loans to cover cash demands in a credit-tight market.

Mayor Phil Gordon is a Democrat who was first elected to a city council position in 1997. In 2003, Gordon was elected to Mayor of Phoenix. He was re-elected in 2007. He has been a proponent of several taxpayer funded projects including the Phoenix light rail system. Gordon has also been heavily criticized for his sanctuary-city immigration policies.


Comments

  1. Videos and pictures of more folks heading north to move Phoenix even further into the red:

    http://www.borderinvasionpics.com

  2. I find it so disturbing that Peggy Neely and Phil Gordon pushed through this $97 Million Dollar tax rebate to the billionaire developers of City North, and then Peggy Neely has the NERVE to go on Channel 12 last night and tell us all that we “don’t get it” and it’s “not a tax break”– she called it an infrastructure reimbursement. Hmm…. paid for by returning SALES TAXES from the City to the DEVELOPER.

    And it’s not only bad enough that Peggy Neely and the entire council and mayor had to cut our city services amidst paying for this $100Million parking garage, but now we find out that our city is asking for a HANDOUT from the Federal Government. What a mess. They make us look very irresponsible. I can’t tell you how livid I am. I hope someone runs again Gordon and Neely.

  3. Bill,

    what about all the other tax breaks given to the auto malls, Wally Worlds, etc??? I think the only council man to challenge these handouts was Tom Simplot

  4. It makes sense to me that Mayor Gordon is asking for some help. Phoenix and Arizona have been some of the regions hit hardest (per GDP) by the slowing of credit markets. With the drought of liquidity, it’s difficult for everyone (businesses and municipalities alike) to meet payroll. I don’t know the specifics of Mayor Gordon’s request, but I suspect that it’s to ensure that the city can continue to provide a consistent level of services without resorting to bonding in a down market.

  5. Ron,

    I agree with you about the Auto Malls, and Tom Simplot has been a great advocate for fiscal restraint on the Council.

    Carson, I don’t know that I think it’s OK for Gordon to try to maintain our services by asking for a federal bailout, and let me explain why.

    First, you are correct that Phoenix (and Arizona in general) has been hurt in this economic mess, but this has been several years coming, and while I know nobody knew how bad it would really be, proper management would figure out a way to “right the ship” without asking for a handout that is meant for Banks, Insurers and other financial institutions and large companies. The government is not supposed to bail out municipalities.

    It’s SO embarrassing that Peggy and Phil were able to convince their colleagues that it was OK to give $100Million to a BILLIONAIRE Developer to build a parking garage for CityNorth. It makes no sense. Then Peggy makes the argument that if they didn’t give that to the developer, then they wouldn’t build in Phoenix, they’d go to Scottsdale. BUT that’s not true, either! The Klutznick’s paid like $10,000 an acre or something like that for the land back in the 1980’s, and it’s now worth nearly $1Million an acre– why on earth would they not build? It’s a false argument. I can’t believe they did this, and I hope someone runs against the whole council who voted for it. I remember reading that Greg Stanton and Tom Simplot didn’t vote for it, so they are innocent– but the rest of them who were there should be gone. Peggy, the Mayor, and Claude Mattox should apologize and resign.

  6. Bill, I agree – handouts to billionaires are bad (and thus also my problem with the so called bailout), but why would you claim the federal government is not suppose to bailout municipalities?

  7. Todd, I am not sure– maybe my argument is flawed– I just feel that bailing out a city is wrong. It just seems like Neely and Gordon made the bed, now we should all have to sleep in it. I guess you could say the same for these big corporations, too.

    It just seems so bizarre to me for the feds to bail out Phoenix. What are your thoughts?

  8. Some folks are mixing apples and oranges here. CityNorth has nothing to do with the current budget issues. There is no current city money going into that project. A portion of the sales tax GENERATED by that site will be rebated to pay for the parking garage. No general funds are involved. You still have a good argument that cities shouldn’t be getting into these bidding wars, but don’t blame the budget deficit on City North.

    In fact, Bob Robb had a good column in the paper Friday about what a good job Phoenix and other cities do in budget balancing, particularly compared to the state. The problem (which does in a sense tie back to CityNorth) is the reliance on sales tax for revenues for ALL cities. When GM sales fall 45 percent, that means sales tax revenues are going to fall as well. Same when Circuit City, Linen and Things, and all the other retailers are closing up shop. So we are part of the fallout of the collapse of the auto industry and other retail, and that’s as good a reason as any to get in line for federal stimulus dollars.

    In Phoenix, 68 percent of the general fund budget goes to police, fire and courts. With sales tax plummeting, what’s left to cut? Cities provide the basic services that we can’t do without, so more federal dollars at the local level would be money well-spent.

  9. The City of Phoenix has done a piss poor job of explaining why they did City North and how the deal works.
    Bill has a pretty good explanation, but he is comment #8 on a blog. Phoenix has millions of dollars of staff time invested in City North, from the City Manager and Deputy City managers, and department heads, but the public still has the perception that City North was a $100 million give away.

  10. That’s because it was a $100M giveaway. In the end, money that the city is entitled to will not be received. And the city won’t collect money that they are entitled to for 11 years. And that deal was made on a false premise- that the developer would not have built the development but for the $100M giveaway.

    They would have built it anyway, and now we get nothing for 11 years.

    If I have to pay to park in that effing parking garage, I’m gonna be pissed.

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