Deja Vu: The Common Council's Fiscal Mismanagement

From the Mohawk Valley Compass article on the Common Council crafting the City Budget:

“Well then I’m taking a shot. I’m going to take a half a million out of fund balance,” said Barone.

Later, Agresta said, “I can’t go with using general fund balance to balance the budget.”

“Before I raise the taxes, I’ll deplete the the fund balance, I don’t care what the state says,” said Barone later in the meeting, “I’m not going to raise taxes and I’m not going over the 2% tax cap.”

If this ‘technique’ to fiscal discipline and management sounds familiar, it should be. Here’s what the NY State Auditors said when precisely this ‘raid the fund balance’ technique was used:

The Board did not adopt realistic and structurally balanced budgets and instead consistently relied on appropriating fund balance, a non-recurring revenue, to finance recurring expenditures. Further, in two of the last three years, the County incurred operating deficits. As a result, the financial condition of the general fund has diminished in recent years. As of December 31, 2012 the County reported a total fund balance of $11.4 million in the general fund, a decline of 41 percent from the January 1, 2010 total fund balance of $19.2 million. We also found that the County’s cash-on-hand declined from twice its average monthly expenditures in 2010 to about $324,000 less than the average monthly expenditures in 2012, and the County’s contingency appropriation is not adequate for current financial conditions. The County’s declining financial condition is the result of poor budgeting and financial management practices and the Board’s failure to develop and use long-term financial plans.

If you’re a confused, and concerned taxpayer like me, you might wonder how the very same Council that touts its fiscal responsibility along with the legion of Council supporters who want the state to come in and basically take over the city all in the name of ‘running things like a business’ and ‘making tough choices’ , can actually proceed with such a plan.

A plan that without question is wholly fiscally irresponsible.  And a plan that runs counter to every single talking point on financials and budgets from the Council and their proponents.

It’s simple really: politics first, financials last.

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22 Responses

  1. J. McDowell says:

    Wait….Isn’t there a simple solution here? Did I not understand that over $600,000.00 in added revenue was being refused by the council? Wouldn’t that solve the problem? Mr. Barone’s plan seems to be to deplete the fund and then blame the mayor for being forced to deplete the fund. Sounds a lot like the adolescent’s excuse for fighting: ” I thought he was going to hit me so I hit him back first.”
    The mayor’s ambulance plan would work. Try saying ‘yes’ to the best interest of the town for a change.

  2. Donna Dickerson says:

    J McDowell, that $600,000.00 was a MAYBE REVENUE NOT A TRUE REVENUE. We need to be told the TRUTH and we NEVER ARE.

    • wildthane says:

      Donna,
      the truth was provided by our Fire Chief. He did very thorough research and analysis and came up with a conservative budget proposal.
      The only mistruth coming your way is that the council has done the same thorough work.

      • rogo says:

        The main fact remains it is against the charter. Unless there is action taken , according to decusatis, the council has to pass local law or maybe referendum, SO IT IS AGAINST THE LAW

        • flippinamsterdam says:

          That is misleading at best– the Council has authority and legal standing to amend charter for the fire department to provide ambulance service. The ‘illegal’ argument is political cover by the Council so they can avoid casting a vote for or against.

      • Donna Dickerson says:

        Ann,
        That is why I say the voters and taxpayers nee to be told the truth. They are kept in the dark way to much, I think there would be less miss leading information if things were out in the open more. I just want a clean, safe city with jobs and no potty mouths and trouble makers. There is so much that can be done if people would STOP STIRRING up TROUBLE so you don’t like some one who cares, MOVE ON

    • Tim Becker says:

      Donna, I have to ask – in regards to this issue of the proposed ambulance service, what exactly has been “kept in the dark”? Both the Compass and Recorder covered the legalities of the ambulance fully in stories that were run on April 8th. Here’s my link…http://mohawkvalleycompass.com/2015/04/proposed-city-ambulance-service-discussed/
      What Rogo is saying is common knowledge to anyone who reads the news. The charter prohibits the fire department from running an ambulance service, however the council, in this case, could change the charter without a referendum under NY State law.
      In my opinion, it was the Common Council that tried to cover up the facts on the proposed ambulance service by cancelling the public safety committee meeting at which Chief Whitty was scheduled to present details for the plan. The Compass was the *only* source (as far as I know) that interviewed Whitty and got all the details of his plan and put it out there. You can read it here.. http://mohawkvalleycompass.com/2015/04/the-ambulance-service-facts-chief-whitty-would-have-told-the-council/
      I would submit that if all your information comes from Facebook groups, then yes, you will be in the dark and totally confused when it comes to these issues.

      • rogo says:

        the coverering up the factcs by mayor and decusatis may have been started months ago. I may be wrong about this but, I believe gavac contract ran out 12/31/2014, then why was new contract only 6 months if i am correct. If I’m right the plans were in works 6 months ago

        • flippinamsterdam says:

          None of this is relevant to the financial issues and just tries to provide political cover for the Council’s inaction and as usual, tries to discredit Corp Counsel because the Council and their supporters don’t like the law when it’s not consistent with their agenda.

  3. Bill says:

    Fire departments all over have added ambulance programs that, in the clear majority of cases, turned out to be revenue generators. Chief Liberti made the case ten years ago and the facts then still hold true today. Barone, the embodiment of a blunt instrument, is obviously ignoring the experts to protect the interest of his friends…the same lot that were the beneficiaries of the snow-job of a decade ago . That sort of thinking is out of date and impractical and, if he were really running a business, would never fly.

  4. Bill says:

    Fire departments all over have added ambulance programs that, in the clear majority of cases, turned out to be revenue generators. Chief Liberti made the case ten years ago and the facts then still hold true today. Barone, the embodiment of a blunt instrument, is obviously ignoring the experts to protect the interest of his friends…the same lot that were the beneficiaries of the snow-job of a decade ago . That sort of thinking is out of date and impractical and, if he were really running a business, would never fly.

  5. rogo says:

    Flippin your reply above. it is only decusatis opinion that the council can change charter. the fact of the matter is . When mayor submitted budget it was not balanced unless laws were changed

    • Rob Millan says:

      The Corporation Counsel’s job is to act in the city’s best best interest on legal matters, and I would take that opinion over any of the non-lawyers on the Common Council.
      It’s like your surgeon telling you you need your gallbladder taken out or face certain death, but refusing to heed his advice because your dermatologist thinks his opinion is the only one that matters.

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