Tuesday, September 14, 2010

Another budget deficit for Toledo?

This headline shouldn't come as a surprise to anyone. I heard a news clip this morning that said the City of Toledo is looking at another budget deficit for 2011.

Part of that deficit is due to spending obligations carried over from 2010. As I wrote in May in "New TPPA agreement just postpones the inevitable," any money 'saved' in 2010 wasn't really 'saved' if it had to still be paid in 2011 - especially if the cost would be higher next year. From that commentary:

In fact, deferring the overtime payments to 2011 and then paying it at the 2011 increased pay rates means that this little deal will actually cost the taxpayers 3.5% more than it would cost us if we just went ahead and paid it when earned!

That's not a savings!

So now we're hearing comments that we could have a budget deficit in 2011 because of this agreement that was supposed to save us money.

Common sense should have told everyone that there would be no savings when you defer compensation and then pay it at a higher hourly rate. But city council members voted to do just that.

I can only wonder how much the trash tax will be next year.

No comments:

Google Analytics Alternative