Needs, Wants, and Other People's Money

Why cities and their citizens must learn to live with "no"

You can't always get what you want, but if you try some time, you just might find you get what you need. - Mick Jagger and Keith Richards

I grew up in the heyday of rock and roll, in the '60s and '70s. And I grew up in Texas, where we were country when country wasn't cool. Music has spoken to me throughout my life, and the occasional nuggets of profundity buried in lyrics written by stoned rockers or singing cowboys helped shape my personality and my values.

Sometimes I thank God for unanswered prayers. - Garth Brooks, Pat Alger, and Larry Bastian

Two songs, different genres, released over two decades apart, but the basic underlying premise is the same. We don't always know what's best for us, and what we so desperately long for - whether that's a job, a title, a person, a house, fame, money, or a particular experience - might not be what we need to make us happy in the long run (or even the short run). This can also be applied to the things we think we want from our government.

I have always been an ambitious overachiever, so it was inevitable that in the journey from then to now, I wanted a lot that I didn't get - but looking back, I know I also got a lot. I'd have to say that all my prayers were answered; it's just that sometimes the answer was "no" and other times it was "not yet" (which in this impatient era of instant gratification felt like a "no").

That brings me to the heart of this discussion: a skill that's essential in the workplace, in the political realm, in personal relationships, and in life in general: distinguishing between wants and needs and treating them accordingly. And if you happen to be in a position to answer prayers (make decisions regarding whether others get what they want or need, another important ability you must develop is the courage to say "no."

Prioritizing needs and wants

In the public sector, which is where much of my experience has been, I like to talk about the essential functions of government. Those are the services and activities for which individual citizens and families depend on the local government that are necessary to life and well-being. Examples are law enforcement and the criminal justice system (police, courts, jails), fire services, ambulance/EMT/paramedic services, emergency and disaster response.

All of the foregoing can be categorized as public safety, as can animal control. Other necessary functions include public works/public infrastructure, such as road construction and maintenance, water and sewer services, and garbage services.

Several years ago, when I was serving on the city's bond committee, I came up with the idea of a hierarchy of governmental needs (which I patterned after Abraham Maslow's well-known Hierarchy of Needs), these are foundational elements upon which all others rest.

"Good things happen when you get your priorities straight."

As shown in the title graphic, and as I'll discuss in more detail later in this article, each level up in the hierarchy consists of governmental functions that are less "need" and more "want." That doesn't mean they aren't legitimate expectations of local government. While parks and libraries aren't essential to life and well-being the way police and fire protection and water are, they are public services or facilities that enhance residents' quality of life to a great degree and that have traditionally been expected by citizens and provided by cities. Few people question the legitimacy of municipalities funding those functions, so long as the essential services take first priority.

The thin blurry line

It's when we get to the fourth level up that controversies begin to ensue. When governments have a surplus of money, they can do one of three things with it:

• Let it sit in a "rainy day fund" (aka contingency or reserve account) to be tapped in case of unexpected emergencies.
• Give it back to the citizens in the form of tax decreases or even direct payments.
• Spend it on items that that may not have been included in the original budget.

Just as it's wise for individuals and families to have savings put aside to address unanticipated expenses, so should governments allocate money for that purpose. However, unlike with personal or corporate money management, in public finance running too large of a surplus can lead to economic and political consequences. Governmental entities are not supposed to be profit-making organizations.

Lower taxes or a refund to citizens would be ideal and could also help to stimulate the economy, but we all know it's very difficult to get a majority of legislators to agree to give up what too many of them consider to be "the city's money." Tax reductions or dropping the cost of fees are framed as "lost revenue." Even homestead or senior exemptions are seen by many elected officials and staff members as a bad thing, a hit to the bottom-line numbers that they (often subconsciously) believe belongs to the city.

Realistically speaking, what most governing bodies end up doing with surpluses, with encouragement from the city staff, falls under the third option: they find something else to spend it on. Too often, they see this "free money" as discretionary income, a windfall that can be spent on the "fun stuff" they aren't obligated to provide.

If we aren't careful, our children will come down with 'affluenza,' a disease that causes them to confuse wants and needs.

When those children grow up to be city councilmembers (or state legislators or U.S. senators or representatives), we get what we have in too many places today: government gone wild. Too much money causes many (not all) people to become arrogant, lazy, and dictatorial. It can have the same effect on governments.

A government big enough to give you everything you want is a government big enough to take from you everything you have.

What we want is what we (think we) need

A rule of thumb for distinguishing our wants from needs as individuals is to ask whether it's crucial to survival. Food, water, shelter, sleep, air to breathe - these are the most basic physiological human needs, the foundational ones at the bottom of Maslow's pyramid.

Essential city services

The municipal government equivalent of those survival needs would be the services without which our citizens are at risk of not surviving or the lack of which places them at serious physical risk, such as law enforcement, fire services, ambulance/EMT services, emergency/disaster response, clean and potable water. (There are other services that fit in this category but usually are provided by an entity other than the city: electrical power, natural gas, Internet connectivity. In some cases, though, municipalities do provide some of these).

Necessary functions of municipal government

Next level up on Maslow's chart are security (physical, financial, and psychological) needs: health, property, work, family. Examples of functions in the second tier of our municipal needs hierarchy include roads and streets, animal control, public health services, and garbage collection.

NOTE: The examples are not intended to be all-inclusive and not every person or every city governing body will agree on exactly which city services belong in which category. One can make an argument that roads and streets belong in essential services, but you can just as reasonably make a case that they go in the "needed" category since they aren't absolutely necessary to survival but are required to provide physical security in getting from one place to another and financial security as a means to get to work to make money.

Practically, it may not make much difference. Both of the two bottom tiers consist of services that cities are expected to, in some cases legally required to, and in my opinion are morally obligated to provide to their citizens in return for the taxes they impose.

Citizen expectations

On the third step up the ladder we find those things that are not necessities but are quality of life enhancing functions that local governments have traditionally provided, and citizens have come to expect. These are often things that might be difficult or impossible for individuals to provide for themselves. Examples could be parks, libraries, community centers, and ceremonial public events (such as holiday parades and 4th of July fireworks shows).

Community amenities

Fourth level up, amenities are those things that are definitely not necessities but are nice to be able to provide if the city has surplus funds after taking care of the real needs. Community centers, nature centers, historical societies, public art, walking and bicycle trails, museums, public boat launches, golf courses, water parks or public pools.

NOTE: in this context, the things listed above are considered public amenities if they're funded in whole or part by taxpayer dollars. Some of these may charge usage fees that make them self-sustaining or even profitable, turning them into revenue sources that can help fund other amenities.

Living in luxury

Luxury expenditures in local government are those items that go beyond need or even the wants of the average city's governing body and citizens: elaborate city buildings with such touches as imported marble, hand-carved woodwork, futuristic technology, and expensive art, or a fleet of Lamborghinis as police vehicles. Not all luxuries are that extreme, of course, and I would contend that normal amenities qualify as luxuries when a city doesn't have the means to fund them without placing an undue burden on its taxpayers.

Things change

Sometimes what was a want turns into a need; for example, you've been wanting to replace the old, ugly fence around the public works yard for years, but other projects took priority. Then a strong storm comes through and destroys sections of it. Now it's no longer just an aesthetic issue; it's a security issue - and has become a need rather than (or in addition to) a want.

Cities are subject to same type of sudden occurrence that bumps a want to the top of the needs list. A tornado rips through city hall, a federal mandate necessitates expensive changes in operations, a serious data breach makes new cybersecurity measures necessary right now.

"Change is expensive but denying the inevitability of change in the long run costs more."

Sometimes it's societal change that turns a want into a need. In the 1990s, a home or work Internet connection was something we might have wanted, but it was a desire, not a necessity. In today's world, the ability to access online resources is a requirement for many jobs, to do schoolwork, and even to conduct our everyday personal business. It has morphed from a want into a need.

Once upon a time, a city didn't need a web presence. Today, not only do cities need websites, but those sites also need to provide access to public documents such as agendas and minutes and video recordings of meetings, as well as information about the city's services and contact information for departments. A dedicated mobile app currently hovers somewhere between "want" and "need."

On the other hand, sometimes what used to be seen as needs turn into wants - or "don't wants." Once upon a time, cities provided, owned, and maintained the sidewalks on residential streets; now in some cities, this is the homeowners' responsibility. When I was younger, the city I lived in took care of the water lines up to the point where they entered the house; where I live today, if it's on any part of your property, it's yours to deal with.

A few decades ago, most cities - even small ones - operated a public swimming pool. Today, due to the liability involved, many small cities don't; their residents go to nearby larger cities that operate big water parks, which usually charge a fee and some of which may realize enough of a profit to be a revenue source or at least self-sustaining.

In addition to dropping or privatizing some previous city services as mentioned above or transferring the responsibility to individual residents or HOAs, cities have also taken on responsibilities that we once didn't expect from government: some of our citizens have confused amenities with entitlements and believe the city should help them get a job, take care of their children, and subsidize everything from their Internet connections to their housing.

"I would like my car to fly and make me breakfast, but that's an unrealistic expectation."

As society's expectations change, the demands on local governments increase and more non-essential services are added to the top tiers of the pyramid.

It's all about the budget - or is it?

Prioritizing the needs and then the wants is the precursor to developing a budget. Under the council-manager form of government, which is the most common form in Texas, the city manager prepares a proposed budget with input from other city staff members, the city council, and sometimes consultants. The budget process tends to be a negotiation, with the final outcome almost always a product of compromise.

One of the purposes of employing a city manager (rather than charging the mayor and/or council with the executive function and operational oversight) is to remove - or at least reduce - the political element in operational decision-making. It's the job of the manager, in the budget process, to ask for what s/he believes will enhance the city's operations, which may include additional personnel, increased compensation, new equipment, new facilities, or new or expanded programs and services. While it's proper for the manager to keep financial realities in mind and not propose wasteful spending, in a negotiation it's generally wise to ask for more than you expect to get.

Ultimately, the budget is the responsibility of the elected officials who have the power to make changes to the proposals and approve it in its final form. They (we) are the ones whose responsibility it is to balance the desires and needs of our citizens and our city employees, our fondness for our own pet projects or departments, the financial cost and the political ramifications of the resultant tax rate.

” Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver.”

There's a very good chance, in any given city, that the governing body won't agree on what should be funded and to what degree. That makes arriving at a budget that will get a majority vote a matter of give and take.

Passing a budget is the important first step in fulfilling needs and wants, providing essentials, necessities, amenities, and (if we chose to do so) luxuries. Living within that budget is the sometimes-forgotten sequel.

None of us have crystal balls, so we can't predict every need that will arise unexpectedly and budget for it. That's why we have contingency funds or reserves, just as individuals have "rainy day savings." But we must resist the temptation to see those funds as slush funds and to dip into them whenever a new want pops up.

“A budget tells us what we can't afford, but it doesn't keep us from buying it.”

The power of "no"

In psychology, the ability to say "no" when necessary, in a compassionate and understanding way, is sometimes referred to as good refusal skills. It doesn't come naturally to most of us. We hate to say "no" to someone we like, but we also hate to say "no" to someone who has (perceived or real) authority over us.

We don't want to disappoint those we care about, so we give in to a spouse's request that we go out to dinner when we're tired and not hungry, or to a child's plea for that toy that costs too much. We don't want to look bad in front of the boss so we agree to take on that project we aren't really qualified to lead or that will mean cancelling our long-planned vacation.

In government, there exists a strange relationship between elected representatives and their constituents. Members of legislative bodies have the authority to make laws and policies that control citizens' lives, but those citizens have the authority, through their votes, to kick that politician out of office and remove that authority. It's not really a peer-to-peer relationship; it's more of a MAD (mutually assured destruction) one. Each holds power over the other.

When elected public officials want to be reelected, or elected to a higher office, they don't like to say "no" to the people who can make that happen (or not). Many bad governmental decisions are made in the effort to please voters, whether that's a misguided majority or a vocal minority. In many cases, those are decisions to put the funding or implementation of some group's (or our own) wants ahead of the city's real needs.

"It's only by saying 'no' that you can concentrate on the things that are really important."

Just as saying "no" to your kids' pleas for more candy is for their own good, saying "no" to budget requests for things that sound great but don't make financial sense may not only benefit the city as a whole, but also be the best thing in the long run for the very people who most adamantly support those requests.

When considering a request for a "big ask," here are some tips to follow:

1. Don't say "yes" or "no" instantly; take time to research, consider and reconsider all the ramifications. Grand ideas can be very appealing in concept but fall apart when you start looking beyond the "what" into the "how."
2. Never let any group or person (including yourself) "guilt" you into saying "yes."
3. Don't say "no" out of anger or dislike for the person(s) making or advocating for the request.
4. Don't say "yes" because you like or feel sorry for the person making or advocating for the request.
5. Be able to back up your "yes" or "no" with logical reasons based on the costs and benefits of granting or denying the request.

“Beware of little expenses. A small leak will sink a great ship."

When it comes to less costly requests, don't let the argument that "it's only XX dollars" lull you into an automatic approval. Consider the danger of setting precedents - if you do it for this one, will you have to do it for others? Also be cognizant of the cumulative value of small numbers (think about the sticker shop at the end of a grocery shopping trip when all the items you bought were individually inexpensive).

"Just because we can doesn't mean we should."

That quote has been attributed to many different people, but whomever said it, it's a powerful statement and one that should guide us all in all aspects of our lives. The authority to spend other people's money (OPM) carries with it a temptation to spend it on the things we think are important rather than the things they think are important. Sometimes our priorities are right, but we're humans and sometimes we're wrong.

We must never forget that our authority comes with a tremendous responsibility. We, who by virtue of our elected or appointed positions have the power to decide how OPM will be spent on the wants and needs of those other people, should pay particularly close attention to its message.

Three groups spend other people's money: children, thieves, politicians. All three need supervision.