Council Battles over City Budget

June 26, 2013
By

Mayoral and City Council relations haven’t been stellar as of late and it appears that the City Budget proposal from Mayor Dan Rizzo isn’t mending any fences.

Many City Council members were nothing short of perturbed at the lateness of this year’s proposal, which came after June 1st for the first time in many years. Over the past 10 days, the Council has been reviewing the budget with a fine-toothed comb and many don’t like what they’re finding.

On the other side of the coin, Mayor Rizzo said he believes the Council is grandstanding in yet another attempt to add to the difficulties between the two bodies.

Councillor Brian Arrigo, chair of the Ways & Means Committee, said this week that he had major concerns about how the budget is crafted. He said one particular concern involves the fact that 16 new positions are added and, at the same time, Rizzo plans to shore up the budget by dipping into the Rainy Day Fund.

It would be the first time that the City has had to remove any money from that account, which was created in 2003.

“We’re hitting up the Rainy Day account and it’s not raining,” he said. “It’s really not good budgeting practice to balance the books with reserve funds or Free Cash. The Rainy Day Fund is for emergencies and I just see this as a dangerous practice to engage in. If you’re adding positions, you shouldn’t also be using reserve funds to shore up the budget.”

Councillor Bob Haas also expressed concerns, saying that the money to be used from the Stabilization Account came from a recently-transferred amount of money from the City’s Free Cash distribution – which arrived in February.

“Free Cash is for one-time uses – to purchase equipment or make improvements to City facilities or to put in the Rainy Day Fund,” he said. “The purpose of Free Cash is really not to balance the budget.”

Rizzo, on the other hand, has a totally different view of the situation, and said he probably made a mistake in trusting that the Council would cooperate with him on the Free Cash transfer.

He said that he transferred $2.8 million into Free Cash a few weeks ago because he needed a safe place to park the money – as the State takes it back on July 1st if it’s not spent or transferred. He estimated that he now needs about $1 million of that money to shore up his budget proposal for Fiscal Year 2014.

“I just parked the money in Stabilization so we wouldn’t lose it,” he said. “I should have probably parked it elsewhere because now they’ll be playing games with me on this because I need eight votes to get it back out. I probably shouldn’t have put it there…Now, when I take $2.8 million in Free Cash and put is somewhere, some councillors feel it’s a reason to hold up the budget. If they want me to cut $1 million, which is what I’m probably going to need, then that’s what I’ll do. We’ll lay off people, cut services, and the councillors can take solace in having another million dollars in Stabilization.

“I think it’s unfortunate and I’ve heard rumblings that they don’t want to use it to balance the budget,” he continued. “If they take this issue for grandstanding and to leave money in Stabilization, then I think it’s disingenuous to say now that the money was not intended to be used for the budget. I said that when they transferred it.”

Rizzo also added that the 16 new positions are not all new faces. He indicated that some are workers who transferred departments, some in the Police Department are a result of trimming existing budgets and some are unfortunate situations where federal grants – such as in the Fire Department – ran out and weren’t renewed.

“I got stuck with a grant running out,” he said. “Two years ago they put on the firefighters and felt that in two years the grant would be renewed or that revenues would be better. Well, we didn’t get the grant again. So, we either lay off 10 new firefighters or bite the bullet and make room for them in the budget. Yes, there are 16 new budget lines, but I don’t think it adds up to 16 new faces.

Rizzo said that it’s not particularly problematic to use Free Cash money to offset the budget deficit. He said that, while former Mayor Tom Ambrosino rarely did that, other entities do so routinely.

“Free Cash is for a one-time use and this is a one time use to balance the budget,” he said. “The State goes into its Stabilization Account to balance its budget all the time. There are times we need it and times we don’t need it. It’s frustrating because I can kind of see what Mayor Ambrosino went through when people wanted to make more of a statement rather than to make more of an impact. The ball will be in the Council’s court.”

Councillors will continue to hold budget hearings this week, and they’re expected to have a Special Emergency Meeting on Thursday, June 27th, to discuss and vote on the Final Budget.

The Budget must be passed by July 1st.

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