Headlines scream at us all the time about the fiscal instability of the world today. Spain, Greece, Italy, all under water.
It has just edged closer to home with the revelation that the city of Utica could have a 5 million dollar deficit in the 2012 operating budget. The Utica school district has announced that there may be a 10 million dollar shortfall in their budget.
What is going on here? Could it really be that bad? A 15 million dollar hole is not something that the citizens of this city can just absorb. What do our leaders intend to do about this? How are they going to possibly come up with that amount of money to fill what apparently is a reflection of years of fiscal mismanagement, generous employee contracts that we cannot afford and a vast inability of our elected officials to address these issues and balance a budget.
This disaster did not happen overnight. It started many years ago and was effectively "swept under the rug" by city officials. The simple fact is this: no one in city hall had the resolve to actually figure out what the systemic issues were that created the budget defecit that has blown up in our faces.
What are the issues that have been ignored for so many years?
First, public safety.
Everyone in Utica knows we have a fine police and fire department. Top rated, excellent service, the best of the best. The question is, and always has been, can we afford it? Are these departments operating at top efficiency? Many years ago, during the Hanna Administration, the city faced a similar situation. Utica had a huge budget shortfall in the late 1990's and needed to cut from somewhere in order to avoid a huge tax increase that was politically unpopular and would devistate city home and business owners.
We were on the verge of bankruptcy. Talk of a Fiscal Control Board taking over was a real possibility. Even N.Y. Comptroller at the time, Carl McCall, warned the city to make deep and unpopular cuts or it would be insolvent.
After months of debate, cuts were eventually made to the fire department. These cuts enabled the city to survive that budget year. They were not, however, cuts that made real change. They were a temporary fix. New recruits and men with the least seniority lost their jobs. No real investigation went into this fix. It was unfair and poorly thought out.
But it bought the city time. And, instead of using that time to figure out how to make real change, our leaders made a decision that has created the situation we now face.
Second, the budget process.
The status quo was maintained by taking our water trust fund and using it to balance the budget. Year after year, mayors, common council members, budget directors, department heads, all maintained the same levels of spending by filling the hole with that trust fund. It was as if everyone thought that the money would last forever.
And now, it is gone. Kaput. Drained like a swimming pool in September.
Our new mayor has to now figure out the mess.
I have ideas, ways that I think we could begin to extract ourselves from this situation. I will reserve those suggestions for a future post. I want to see what the administration comes up with. I know our mayor has some ideas of his own.
As far as the school district is concerned, it's the same story. The new superintendent, a local man with tons of experience, will hopefully be able to mop up the flood of fiscal mismanagement he has inherited.
To that end, both men, Mayor Robert Palmieri, and Superintendent Bruce Karam just announced a series of initiatives that will, for the first time, unite the city and the school district together to explore ways to cut costs by sharing services.
It's a great idea. One that should have happened 20 years ago. Hopefully, it's not too late.