The Mayor's proposed FY20 budget is expected to be out tomorrow. This post is about what I am expecting to see in it. There's no way to talk about that without a lot of numbers. My apologies in advance for that.

Before I get going -- keep in mind that this isn't a discussion of numbers just for the sake of numbers. The budget is a moral document that is hard proof of the city's priorities. There's no way to debate the priorities without understanding the numbers.

I've been prepping for this budget season with my own sort of Spring Training. In March, in writing this about proposed pay raises, I commented that the FY20 budget would need to have at least $105 million in new expenses:

Even if we were to pretend there is no inflation, the total is $105.8 million of new obligations for FY20 according to Metro Finance’s numbers last year.

And yesterday, I predicted the same $105 million increase in the overall operating budget, up to $2.335 billion for FY20:https://twitter.com/mendesbob/status/1122925339607535616At the State of Metro address today, the Mayor told us that the proposed FY20 operating budget would be $2.33 billion. So my prediction was off by $5 million (or 0.2%).

I haven't seen any part of the upcoming proposed budget yet, but having my prediction be this close gives me some confidence of what I think will be in this budget.

Revenue: My predictions are based on there being $90 million of new tax revenue, using $10 million from the Funds Balance (which is the city's savings account), and $40 million from one-time non-recurring revenue. These numbers work together. I might be off on a few, but I think the total of all of them will be pretty close.

For example, the parking privatization deal (if approved) is supposed to generate one-time revenue of $34 million by June 30, 2020. Depending on when Metro would book that revenue, it might impact both my Funds Balance and one-time revenue predictions. In the end, these timing issues don't really matter.

What's important is that I am expecting the FY20 budget to rely on and need the $34 million from the parking deal by June 30, 2020 to make ends meet.

Schools: I assumed that the proposed budget would fund a 3% raise. That's what the Mayor announced today in the State of Metro address. The requested MNPS budget was for 10% raises. This request is apparently being rejected.

One unknown is whether the Mayor will attempt to make the 3% raises contingent on the school board entering into a Memorandum of Understanding with Metro. At the State of Metro address, the Mayor repeated his request that the school board enter an MOU with Metro to give Metro more control over "finances, operations, and human resources."Most Metro insiders do not know what this would look like. I don't know whether the school board will agree to this. I don't know whether the Council would require the MOU. We don't know yet whether the Mayor will demand the MOU in exchange for the 3% raise.

New spending: I assumed that the Mayor would propose very limited new spending. I guessed $4 million. At the address today, he mentioned about $1.5 million in new non-salary spending. We'll see the details when the budget comes out.

Ongoing departmental "targeted savings": One continuing challenge is that inflation is running at about 1.9%. Metro isn't immune to this. Normally, you'd expect to see an operating budget increase to cover inflation at least. I have assumed that Metro is ignoring inflation and not increasing any spending (aside from employee wages). How do you get away with ignoring inflation?

The answer is that, through this current fiscal year, Metro Finance has continued to demand "targeted savings" (aka cuts) from each department. I am told that the total targeted savings for FY19 across all departments are in the range of $11.5 million. This isn't enough to cover inflation. For this reason, I would expect that the departments will be told to target even more savings (aka cut more) during the upcoming FY20.

Metro employee raises: The Mayor has been telling the media since March that he intends to give employees their cost of living increase this year. I have numbers from last year for what that would cost. So that part of my budget guess was pretty reliable.

Increased debt service payments: FY20 was always going to have a dramatic increase in the amount of annual debt service payments. This has been known for several years. During the speech today, the Mayor mentioned this briefly. He acknowledged that the debt service payments would be 15% higher in FY20 than the current year.

What does it all mean? Again, I'm not going through these numbers for fun. The goal is to see what's being valued in the proposed budget.

On the plus side, even if it a year late and several percentage points short, there will be employee raises in the Mayor's proposed FY20 budget. On the down side, it looks like this will be another fundamentally under-funded budget that relies on $30 to $40 million in one-time revenue coming in by June 30, 2020, having departments find even more "targeted savings," and still being behind on employee wages. If my sense of what to expect bears out when we see the budget in the coming days, we'll all have to reflect on whether these choices match our values as a city.

I'll keep you posted on my thoughts as the budget season unfolds.