Friday, January 30, 2009

Toledo's $8 million budget deficit - for last year!

Three weeks ago, Toledo City Council passed a budget for 2009. As I asked at the time, how could they do this properly when they didn't have 2008 year-end figures?

Yesterday, the city's finance director informed council members that they need to come up with $8 million to close out the 2008 budget. Oh - and there's only $6 million in the budget stabilization (rainy day) fund.

The biggest question I have now is this: how in the world didn't the city know three weeks ago that they were this much in the hole????

How could the finance director and administration not realize or understand that the deficit for 2008 was going to be this high? As late as this past Wednesday, just two days ago, Bob Reinbolt, the mayor's chief of staff, said the rainy day fund would be gone in 2009 because of lower than expected revenues.

"Although the mayor said in November that the city would not tap into the rainy-day fund to close out 2008 and balance last year's operating budget, that is now the plan, Mr. Reinbolt said.

"I imagine between the 2008 and 2009 budgets, I am confident there will be nothing left," Mr. Reinbolt said."

Really? between 2008 and 2009 budgets? And then, one day later (24 hours!), the finance director is saying there isn't enough in the fund to even close out 2008? Either Reinbolt didn't have a clue or he was purposefully not being as forthcoming as he should have been.

Don't forget, city council already transferred $8 million in funds from the Capital Improvements budgets and other accounts to cover the hole. And now they need to come up with $8 million more? So our total overspending in 2008 was $16 million??? And that's not even the final figure since December's numbers aren't yet finalized.

Maybe it's time for more severe cuts. Start with the city charter and fund only what's mandated. Take a look at the Toledo Municipal Code that 'requires' (only because council has passed an ordinance) certain boards and commissions and then repeal the ordinances to eliminate them. Eliminate the funding for various projects like pools and solar fields. Eliminate the youth commission and recreation departments. Stop purchasing flowers - especially annuals - and bike paths when roads should be a priority.

Accept the challenge issued by AFSCME Local 2058 president Alan Cox to reduce the Mayor's Office staff back to 1993 levels. That would eliminate 22 positions that have been created solely because of a change to a strong-mayor form of government. Cox raised a good question when he asked why a strong mayor needs 22 more staff to run the city than the city manager needed.

Renegotiate union contracts and insist on payroll deductions and copays for medical insurance that are at the same level as the local private sector. Offer continued employment as the incentive - that's what the private sector who pays for these things has had to do. Require that all workers actually work 8 hours (including our trash collectors). Many areas of government report at 8:30 a.m. and leave at 4:30 p.m. but still get lunches and breaks. If we're paying people for 8 hours, get 8 hours of work out of them. How many people could we do without if the rest of the staff was working another 2.5 - 5 hours a week?

And don't expect that the Democrat stimulus package passed by the House and currently in the Senate will save us from having to make tough decisions!

This budgetary problem has been building for years and the only thing that will solve it is taking an axe to spending.

7 comments:

Hooda Thunkit said...

All good points Maggie, but the hole has already been dug and the guy with the shovel still has it in his hands.

Surely just changing to competent management isn't going to fill the hole; even more prioritized cuts than you have listed aren't enough to fill the hole (and the projected $21 Mil. 2009 deficit "guess" isn't even close), City layoffs may have to go back to the cuts we took in the late 70's and early eighties.

Whole Departments/Divisions may have to go...

:-(

Brian W said...

Maggie, I agree with you..How can any citizen of Toledo believe anything that comes out of the 22nd floor...City council should tell the administration NO for the use of the 6-million dollars from the rainy day fund and tell them to come back to city council with drastic cuts. If that means four (8hour) work weeks then fine..or a reduction of city service that's fine also. The administration had to know that the city was in 16 million dollars in the red earlier this month when they went to council to balance the budget. Why now...

Maggie Thurber said...

Hooda - that's fine with me!

While I'd be sorry for the employees who would suffer because of bad decisions made by council and the mayor, I have to think of my family first and I can't afford their expense.

The other solution would be to leave the area, removing my family and our businesses from the tax roles, while going into another one that would allow us to either get more value for our taxes or lower the rates we pay.

Which is exactly what others have already done...even though our politicians refuse to admit it...

Carol said...

I fell compelled to weigh in on this one.

The arrogance of the administration - this one and the last 3 - has left the city of Toledo in a terrible position.

With the total disregard of the administration for the citizens, it's almost fitting that they (government) are now caught with their pants down. Perhaps the citizenry will wake up and realize that they have been being duped repeatedly. And this realization should make every resident of Toledo absolutely livid. Unless they like being lied to.

The consequences for the 'regular' folks when they make such irresponsible decisions such as government has made is to lose their homes, lose their autos, lose their credit rating, lose their jobs, lose ... well, everything. But the administration simply shrugs and relies on being able to 'sweet talk' the residents into believing that this is all such a surprise. That they had no idea they were so short on money.

My question becomes: If I hired you (the city) to manage my money (taxes, resources, etc) and you had me convinced that you are competent to do that ... then you are revealed to have some serious shortcomings ... and I supposed to excuse the lies you told? All because you 'meant' to do better?

We removed ourselves from Toledo. We removed our taxes, our support for local businesses, our presence as a supporter of a city that refuses to learn from its mistakes. It was the absolute best thing we have done for US.

I feel bad that others are floundering in a sea of hopelessness. And I know many that would love to jump ship and leave, too. But they are caught in a position of 'environmentally induced poverty'(aka/dba Toledo city government) that has them trapped on a sinking ship. My heart breaks for them.

I'm thinking that the pivotal moment in Toledo's revival will be when/if the Federal government steps in an places the city in some form of receivorship. Maybe that will hit home hard enough that the residents will stop being duped by slick politicians with empty promises.

Hooda Thunkit said...

Maggie,

"The other solution would be to leave the area, removing my family and our businesses from the tax roles, while going into another one that would allow us to either get more value for our taxes or lower the rates we pay."

Exactly, and as you point out, that's what many have done and many more are going to do.


Stupidity and arrogance isn't the sole purview of those elected, but also extends to those doing the electing; the ones who "get it" ARE leaving, thereby deepening the hole. . .

Tim Higgins said...

Maggie,

You put a grim choice before us. Either the administration is comprised of fools who have no concept of fiscal management on the scale required by a city like Toledo, or they are liars who attempt to feed us the bad-tasting medicine a spoonful at a time in the hopes of preventing tar and feathering. Or is it simply perhaps that they are both?

Forget the computer system, the flowers, the signs, and the bike paths. It appears that Mayor Finbeiner and his band of merry men have been operating what may border on check kiting at best criminal conspiracy and malfeasance at worst.

And city council better step up to the plate and say so this time, lest they be held as co-conspirators and accessories before and after the fact as the elections approach.

Kathy said...

Whoa....all of a sudden, 2008 isn't balanced? Clearly the management from the 22nd floor is to blame, but what about city council. Too often they throw up their hands and say "we didn't know because they didn't tell us"...both sides need to start working together.

And the city of Toledo workers need to step up to the plate. If they worked in the private sector, they would be facing much higher weekly deductions for health insurance ($50-$80 at least), or an employer forcing them into a "High Deductible Health Savings Plan", where you don't even get a benefit until you've used up $5000 in medical care

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