Budget Shortfalls Loom Over Growth In Fischer’s Annual Address
At Thursday's State of the City Address, Louisville Mayor Greg Fischer praised the city’s economic accomplishments while pointing to the city’s rising pension obligations, which he says threaten to stall investment in the city’s future.
The mayor held the address inside the gymnasium at the new YMCA near 18th Street and West Broadway. The location served a dual purpose. First, to highlight the investments the administration is making in the West End, and second, to emphasize the future of the city’s youth.
Throughout his speech, Fischer returned to the theme of Louisville's next generation, emphasizing that the decisions the city makes today affect the world of tomorrow.
“And imagine what we could do with the power to create our own future. We could address the key challenges that I talked about, equity, workforce, our built environment,” Fischer said. “We could invest in the under-resourced teenager who wants a future of education and opportunity.”
Fischer called the state of the city strong. He noted the city’s $78 billion economy, which he says has added 83,000 jobs and more than 3,000 new businesses since 2014.
He highlighted recent developments including the YMCA, Logan Street Market, Paristown Hall and the new Northeast Regional Library, and projects still underway like the new soccer stadium in Butchertown.
“Our nation has outdated education, welfare, healthcare and taxation systems that are inadequate to the task of building communities ready to compete in the 21st century,” Fischer said.
Fischer said future investments in the city cannot take place without addressing Louisville’s budget shortfalls. Over the next three years, pension obligations and inflation will cause government expenses to outpace revenues, he said.
When Fischer took office in 2011, pension obligations made up 7 percent of the city's budget, but by the time he leaves office in 2023, those obligations will have tripled to 21 percent, he said.
Last year the city eliminated 300 jobs, closed libraries and public pools to combat rising pension costs. To avoid more cuts, and increase investment Fischer said the city needs to raise revenues.
“So I’m pleased by what we’ve done with what we have, but it is not a sustainable issue. And the only way to change that is for you all, as voters, to express your dissatisfaction with those that are in office,” Fischer said.
Fischer floated the possibility of new restaurant and road taxes as well as revisiting an insurance premium tax hike, which the council rejected last year.
Democratic Councilman Markus Winkler (D-17) said there is bipartisan support among Metro Council to raise city revenues, but members disagree over how to get it done.
“I think everybody recognizes that by the time we get the full brunt of the pension, we cannot absorb that in our existing budget,” Winkler said.
Republican council members did not immediately return requests for comment on the mayor's address.
This story has been updated.