Excel for Dummies ... by gimleteye

Dear County Commissioners,

The news is out: the proposed county budget from Mayor Carlos Alvarez' administration is ready for your review. It is harsh. It is painful. 1,700 county employees may lose their jobs. Under such circumstances you will be under tremendous pressure, and in particular you will want to be fully informed about the formulas used to build the budget.

What makes this particular time so difficult is that you have shown (except for a few of you, you know who you are) almost no curiousity about revenue. As far as you are concerned, bright skies are just around the corner. Part of the problem is that the media-- whom you like to bash at every occasion--has itself consistently misstated the depth of today's economic crises. What if the "green shoots" of the economy are wrong and only predictive only of stagnation? What if we are in a multi-year, perhaps even a decadal, period of stagflation. What if we are on the cusp of inflation? What if real estate markets fall to 1980's pricing? Fortunately, dear commissioners, there is a program from Microsoft Corporation called Excel that can turn those "what if" questions into hard numbers. Have you heard of Excel?

I'm guessing that a few of you have heard of Microsoft. That's the company started by Bill Gates. Have you heard of Bill Gates? He's a billionaire. That makes him even wealthier than Sergio Pino or Rodney Barreto or Chris Korge or Courtney Cunningham and even Ron Book and Jorge Perez. It makes Bill Gates wealthier than any of them plus Armando Codina and Adolfo Henriques times ten. His company makes the program called Powerpoint that provides you with presentations like the one on the Florida Marlins deal, for instance. Here is a crazy feature of Excel: you can take very complicated formulas made from numbers like income and expenses for a budget and ask questions: "what if" certain numbers change. What happens to the formula, then? And imagine this: Excel does this the same way for my home budget as it does for our $8 plus billion dollar county budget!

You might think because you have an $8 plus billion dollar budget that you need more bells and whistles than my little program that comes pre-installed on my computer with Powerpoint and Outlook and Word. But no! The program works the same way on little formulas as big ones. You don't even need to know how to use Excel. You just need to have someone, somewhere, on the county manager's staff who does. And you need them to do some "scenario planning" for you.

"Scenario planning" (this is for Pepe Diaz, former US Marine) is what the military does when it evaluates different options on the battle field. They ask lots of 'what if' questions, too. (Let's say you are developer, Pepe, and have 367 potential building sites. With Excel you could drop the price by 40 percent and see what revenues you have, but you only need to do the formula once, copy it to each of the 367 "cells" (ie. trailer home sites) and Excel does the rest. Also, you could increase your financing costs by 3 or 4 percent across each of the sites and it would automatically update the totals.)

In Miami Today, Michael Lewis writes that when the county commission was asked to approve the bonding for the Florida Marlins at two in the morning, you were given a repayment schedule that "presumes rapid and undiminished annual growth in tourist tax receipts starting at 10% in 2011 and never dipping below 5% thereafter through 2049." Mr. Lewis asks, "Who believes 38 years of uninterrupted growth? Ever hear of hurricanes? It's also possible that the county won't face hundreds of millions in change-order charges that the stadium developer, a Marlins subsidiary, could try to shove onto taxpayers."

It is also possible that it won't "snow three feet in July" or, more to the point, that sea level rise won't have any effect on revenues within the service lifetime of the bonds for the Marlin's Stadium (or for two new nuclear reactors at Turkey Point.) But what if it does?

If you were responsible to your constituents and to taxpayers, you would be asking those 'what if' questions. But maybe you don't know about Excel, so I'm bringing it to your attention. If you take a hard enough look at our current economy, you might find that the 'what if's' actually help move your deliberations on the county budget. You also have some time to ask those 'what if' questions about the Marlin's deal, that you didn't ask-- or that County Manager George Burgess didn't provide to three of you.

Here is my suggestion of the week to those three county commissioners who deserve a star on their next agenda package: Katy Sorenson, Carlos Gimenez, and Sally Heyman. Go out and buy "Excel for Dummies" (at Books and Books) and give copies to your colleagues on the county dais during the presentation part of the next county commission agenda. I might even come down to the County Chamber and take a photo and put it on the blog.