Tuesday, July 31, 2012

Toledo has money burning a hole in its pocket

Cities and counties are getting their first revenue from the new casinos as the state cuts the checks today.

The Blade is reporting what Toledo plans to do with the money:

The city of Toledo also is to receive $192,041, much of which is likely to go into the general fund. City spokesman Jen Sorgenfrei said some of the money also may be placed in the city's budget stabilization "rainy day" fund "to begin building our reserves and getting ourselves back on solid financial ground."

But I think there's a problem with this. You see, back on January 31, when Toledo City Council passed the 2012 General Fund budget, they discussed the fact that the Hollywood Casino had to delay their opening date to June. As a result, Toledo was not going to get the total amount of revenue that they had budgeted because, obviously, there would be no revenue until the new attraction opened.

So, to make up the loss, they transferred $1.1 million out of the Capital Improvement Plan fund (CIP) to make up for the loss.

As I wrote at the time:

Actually, what makes it worse is that, based upon some updated projections, council decided it actually had about $1 million more than it had budgeted. But instead of reducing the amount they planned to take out of the CIP, they SPENT IT!

So council didn't reduce spending to accommodate the reduction in revenue - they stole from the CIP so they wouldn't have to cut. And then, after finding out they have roughly the same amount in unexpected revenue, spent that, too!

They could have just used the unexpected revenue to cover the unexpected reduction from the casino.

But not our city council!

So now Toledo is getting their first piece of the casino pie - and they're going to spend it like they planned.

Now, they *might* put it in the budget stabilization fund, which wouldn't be a bad thing, but they've not repaid the $50 million they've stolen from the CIP over the last several years and they still have budgeted a $12 million transfer out of CIP for 2012.

The problem isn't the revenue - it's the spending. Council had an opportunity NOT to raid the CIP in January when they found an unexpected $1 million extra revenue. That certainly could have covered the lack of casino income, but council spent it instead - on a new filing system for council and a temporary employee to fill it, two inspectors a council member wanted but the department didn't, and a consultant to create a Historic Preservation Plan. Certainly these are critical, essential items that necessitate raiding our road and infrastructure fund for.

And let's not forget the Recreation Levy because the city 'just doesn't have enough money for parks and softball'! Oh - and that is despite the extra funding from the additional red light cameras that was supposed to go to recreation in the first place.

So here we are with the first revenue from the casino and, as planned, it's going to be spent.

Does anyone else see anything wrong with this picture?

1 comment:

Mad Jack said...

Yes, I see what's wrong. The same thing that's been wrong with our government since day 1: Once elected, our elected officials are not held responsible for their actions.

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