Utilities Department is City's Slush Fund
Original post made by Chris, Palo Alto Hills, on May 2, 2007
Diana Diamond's recent column (Web Link) reveals more details about just what a slush fund the utilities revenues are for our government.
It's been previously noted how the city gets around legal spending restrictions by transferring inherently municipal functions, like street light maintenance to the Utilities Department. The accounting shenanigans uncovered by Diamond, and the justifications for them proffered by city officials, show just how intellectually dishonest the whole "Utilities" enterprise has become.
Diamond's piece notes that 25% or so of the city's general fund budget comes from the various Utility transfer schemes. This is money that comes out of the pockets of all Utility users - who (for the most part) are residents and taxpayers of the city. That is, this 25% of city revenues is functionally equivalent to a tax - of upwards of $30 million per year.
We should remember this the next time city officials plead poverty when asking for even more taxes for bonds and the like.