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Does council’s budget put us on same path county was on?

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If there’s one thing I’ve learned from attending common council meetings this year is that Alderman Ron Barone knows what he’s doing because he’s had 11 years experience as a Montgomery County supervisor. I know this because he makes a point of mentioning it at almost every meeting. And that’s fine, he was elected based on his experience.

But I think it’s worth looking at the legacy of the old board of supervisors’ way of handling the budget, because it seems to me that we may be heading down the same path.

Barone’s motto during this process has been “do more with less.” Of course that sounds like a good thing. Council members followed through with that idea and eliminated 3 full time positions from the budget. One of those cuts was to eliminate Corporation Counsel Gerard DeCusatis’ full time assistant, even though he has gone on record to say that eliminating the position will impact his ability to process legal matters for the city. Barone disagrees, saying that the City Clerk’s office will be able to pick up the extra work.

County Executive Matthew Ossenfort (R)  had his own take on the effect of  “doing more with less” has had on county operations over the years. In a recent interview with the Compass, he criticized the old board of supervisors’ way of doing things saying:

One of the glaring things that I’ve noticed over the years, is the way the board of supervisors…the way they’ve acted as far as cutting budgets… they’ve simply removed positions when people retired – over and over and over again – and what it’s done is devastated the county departments…What I’m hearing loud and clear is – the days of doing more with less are over and now we are in a situation where we are doing less with less.

Could this description be a vision of the future state of the city?

The other way we know that Barone is looking to bring old county ideas into the city budget is because he said a couple months ago that he wanted to spend down the fund balance in order to reduce taxes. Back in April, he said, “I sat on a 21 million dollar fund balance at the county and we depleted it.” He defended the action saying that is was to reduce taxes.

I think it’s worth mentioning here that the shrinking size of the fund balance was something that many critics, especially Alderwoman Diane Hatzenbuhler, attacked Mayor Ann Thane on constantly before last November’s election. But now, none of those same people are holding him accountable on this particular idea.

Controller Matt Agresta (R) called spending down the fund balance a “horrible idea.” And guess what – the NY State Office of the Comptroller agrees as well. A recent audit of Montgomery County’s finances found:

The Board did not adopt realistic and structurally balanced budgets and instead consistently relied on appropriating fund balance, a non-recurring revenue, to finance recurring expenditures. Further, in two of the last three years, the County incurred operating deficits. As a result, the financial condition of the general fund has diminished in recent years…The County’s declining financial condition is the result of poor budgeting and financial management practices and the Board’s failure to develop and use long-term financial plans.

The city’s exact fund balance isn’t known right now because of ongoing reconciliation work. Hopefully that will all be cleared up by the end of the year. However, last year’s budget had a $60,000 contingency line in the general fund. Funds from that line have not been used this year. The mayor’s budget increased the line to $100,000, but  the council has increased that line to $150,000.

Before voting on their final budget adjustments, the council asked all departments to shave another 1% off their existing budgets, regardless if they had already made reductions or not. Frankly, I’m not convinced the council really knows if these cuts are realistic or not. Could that be why they increased the contingency line?

With the budget approved, taxes and fees will be set for the year. However if operating costs exceed the budgeted amounts, we’ll have to dip into contingency and then potentially into the fund balance. No doubt, the council will score points with the voters for keeping taxes down. But have they done so by putting the city into a worse position operationally and financially? We’ll have to take a close look throughout this coming fiscal year to see how many times the contingency or fund balance money is used to cover budget shortfalls.

(Photo Copyright Dreamstime/Larryhw)

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About Tim Becker

Tim Becker is the owner of AnthemWebsites.com LLC which publishes The Compass. He serves as both editor and a writer.

12 Responses to Does council’s budget put us on same path county was on?

  1. Dorothy says:

    As you have correctly observed, Mr. Barone spends so much of his time looking into the past, that he fails to consider the the consequences of his decisions on OUR future. Let’s hope when he is walking backwards in five years, he hasn’t left a legacy of destruction. My hope is that the other council members have a positive vision for our city and act on it.

  2. Amen.

    Every time I hear experience at the County level touted as something positive, I want to point out that our voters changed that form of government because it was so mismanaged and dysfunctional.

    The antics of the Supervisors did not work there
    and they won’t work here.

    Spent down a $21 million dollar fund balance… goodness gracious.

  3. diane says:

    While much has been made of the comments concerning the fund balance at the county, if I remember correctly they were told by the state auditors they were holding too much, which in fact meant they were overtaxing the people. No doubt the dysfunction at the county level seems to have ironed itself out with a new form of government.

    This council has been very careful in deciding which cuts to make. Our biggest obstacle is dealing with the unions in light of all the large raises given out last year. That was inexcusable on the part of the department heads for putting them up, the mayor and then the council for accepting them. When you have finances that are out of whack or simply non existent, it makes no sense to throw outlandish salary increases into the mix, especially when those same individuals are members of a union that negotiated a 2% raise on top of it. This was certainly irresponsible for all involved. There must be fairness within all the employee groups and one must balance them all against the whole. We just cannot continue to throw out more raises when we do not know where we stand financially. It is just plain wrong !

    We also have a long time employee with almost 10 years that wants to go full time. We have a slot in the rec department that only requires a part time individual with the same skill set as our current employee. So instead of taking this long time person, the department head brings in an outsider demanding that it be full time when part time will do. I said last year at this time this position did not require a full time person and it still does not. We are not talking about being a genius, but when the person that left was working from home last year and running department head errands, I am deeply concerned about the appropriateness of this position all together. With the proper time management skills it can be done on a part time basis, especially in light of the fact that the department is need of some new used vehicles in order to perform the department’s functions in clearing the vacant lots. Priorities need to be looked at and the right decisions made for the good of the city.

    Our city employees are already paid above most of the residents of the city and the county. This council was elected to bring accountability back to city government through appropriate spending. Our taxpayers cannot take any more increases in their taxes and fees, and what ever little we can save them is better than nothing at all. We represent the people and what they want and what they need to survive , so that those homeowners that are left can afford to stay in their homes and live a comfortable life that they have earned. Taxing our residents to death is not the solution, especially when it does not impact city operations.

  4. Tim Becker says:

    There is nowhere in the audit that says the fund balance was ever too high. In fact it says the opposite, here’s another excerpt:

    The Board did not adopt realistic and structurally balanced budgets and instead consistently relied on appropriating fund balance, a nonrecurring revenue, to finance recurring expenditures. Further, in two of the last three years, the County incurred operating deficits. As a result, the financial condition of the general fund has diminished in recent years. As of December 31, 2012, the County reported a total fund balance of $11.4 million in the general fund, a decline of 41 percent from the January 1, 2010, total fund balance of $19.2 million. We also found that the County’s cash on hand declined from twice its average monthly expenditures in 2010 to about $324,000 less than the average monthly expenditures in 2012, and the County’s contingency appropriation is not adequate for current financial conditions.

  5. Tim Becker says:

    I’m also going to dispute the “taxed to death” argument. I’ve dis-proven this before. The truth is that the overall cost of living in Amsterdam is very reasonable compared to surrounding areas. Anyone who I ask as to why they chose Amsterdam to live, they usually respond it’s because of the low cost of living. That doesn’t mean I want to see taxes skyrocket. I feel bad for anyone who is struggling. But the truth is, if they are struggling to pay their mortgage/tax in Amsterdam, there’s not too many other places where they will fare much better.

    • Rob Millan says:

      …except the ‘taxed to death’ defense is always easier to convince people with since no tax is too low. It also is effective when used to scare people to vote for you.

  6. Pingback: How the Common Council and the School Board Consistently Mislead the Amsterdam Taxpayer By Demagoguing on Taxes But In Reality Fleecing Them Out of Tens of Thousands of Dollars in Home Values | Flippin' Amsterdam NY

  7. As the prior council agreed, all raises were appropriate and reasonable. No “outlandish” raises were given. The particular employees had been doing an exceptional job and the council wisely awarded performance. Raises are never thrown around wildly, they are carefully considered and agreed upon.

    I cannot understand why the alderwoman continues to rail against the recreation assistant position even though the rest of the council has agreed to keep the position fully funded in the current budget. She insists that it should be a part-time job when the department head has repeatedly stated the need for full-time help. She argues that this specialized job can be done by anyone else (job candidates were screened for experience working with youth & families, social networking & tech abilities, event coordination and established relationships with not-for-profits & the school district.)

    She continues to spread rumors. The past recreation assistant did a great job, raising over $80k in revenues during her time of employment. She did not run personal errands and worked from her office on the third floor of city hall. If this woman’s concern is the bottom line, why was she so critical of an individual that brought in four times what we were paying her? The unfortunate reality is that we lost that individual because she couldn’t afford to live on $20K a year.

    Comparing the salaries of city employees to what people in the community make is ridiculous. Each position has different responsibilities, educational, vocational or experiential demands that command varying compensation. I do not expect to pay my lawyer, engineer or assessor less because someone working at Stewart’s makes less. We are not living on a communist society. As well, most employee salaries have been negotiated and are protected. Cutting into the bone of those employees that are not covered is capricious and unfair, as it really does very little in the way of saving tax payers on their bills but destroys morale. A good manager would know that.

    As Tim notes, we do not “tax our residents to death.” Our rates are reasonable. I think many people look at that combined city, county, school tax burden and blame the city without realizing that we are the smallest portion of the billed total. We’ve been very proactive over the six years and have offset rapidly increasing costs with creatively negotiated revenue deals and restructured utility fees that benefit city residents.

    Honestly, I hear a whole bunch of criticism but not a lot of good ideas listed above. My administration has a record of successful deals and projects I can point to, working in collaboration with past councils, and there are more on the horizon. It’d be nice if this council’d get on board. We have much more to gain by working together.

    • Charlie K. says:

      I was particularly offended to read comments on social media and blogs accusing the recreation assistant of being paid to Facebook and send blast e-mails all day. I know first-hand that she did so much more than that. Last year’s fall festival would’ve never happened and wouldn’t have been nearly as successful had it not been for her hard work on the project. That’s just one example.
      And frankly, another great community event where the alderwoman was nowhere to be found.

      • diane says:

        Because I do not attend community events does not mean that I am not interested in or care about our community. I do things from behind the scenes many times and will continue to do so. And while I do not remember the date, many times I have had conflicts with family events. If it was October 17th weekend last year, I was in Palm Coast with my other siblings celebrating my mother’s 90th Birthday 🙂 This year and last year Spring fling conflicted with my daughter’s law school graduations 🙂 My priorities are in the right place. 🙂

  8. diane says:

    Tim, my apologies if my memory is not serving me correctly as I was not referring to any document, but discussions on the subject of the fund balance.

    As for the salary increases, a 10,000.00 salary increase to one individual is obscene in our small community. No one can convince me otherwise. Because another department head has an engineering degree, another one has degrees in accounting and such, you allow an employee that does his job, but does not keep records to justify his increase so he can be on the same level as the others. That is absurd. The previous department director oversaw the golf course in addition to the rec department which had many more teams playing in the city at the time. He did a lot more work. We do not have as many teams playing now, as I understand they have moved to traveling teams. These are not justifiable reasons for a raise. Other raises last year were also inappropriate in light of the fact that they were all union members and that raise was above and beyond. As for the individual that is doing all this fund raising, we are being told the city cannot fund raise, so how is this happening. I know the funds go into separate accounts, but just how much do you think the public can support the repeated calls for financial assistance over and above the taxes they pay ?

    Government should be limited to the necessities, police, fire and DPW. Then monies permitting we can look at other things. We cannot be all things to all people. We just cannot afford it. That includes hiring someone to fund raise for the recreation department. We do not belong in the business of fund raising period and that is what this person is supposed to do.

    When the arts center was first thought up, (this was never approved by the common council) it was to be a 501 c3 with a board and such and to be on its own once the non profit status was approved. Then everything turned around, that group left and the mayor took over. Monies have gone into painting, carpet, and other repair and maintenance items. In addition the utility bills are not cheap. How about the impact of the cost of materials on the volunteers, that do volunteer their time and talents. Is it fair to them to be putting in all their own expenses every time their is a need. Unfortunately, they too need to be compensated and we cannot afford to do it. ALL programs are supposed to be volunteer. I am not saying something of this nature is not needed, this is a luxury for this city’s taxpayers and should be picked up by a not for profit. I completely understand the goal, it is not something government needs to be in. If the community wants it, it is going to have to find the right organization to take it over, it is not supporting itself and I do not see where it can ever do so. The idea is great, not government’s responsibility, period.

    As for the comments, people cannot afford to pay their taxes, our population is made up of many seniors who are limited income. These folks worked in the mills back in the 40, 50, 60, 70 and do not have the retirement incomes that people do today. Older people in Amsterdam may own their homes, but the maintenance, the utilities and insurances and taxes are killing them. Food is the last item on their list. They paid their dues, they own their homes, but instead of being able to enjoy retirement they worry if they are going to have enough left over to feed themselves. They won’t tell you that, because they have too much pride. Please, stop and think. We don’t need these folks to sell their homes either, we do not need anymore absentee landlords taking advantage of the city and using it as a dumping ground. We are essentially being destroyed from within by the decisions that are being made in city hall.

    • Tim Becker says:

      Diane, your strategy as far as how to run the government is like a restaurant owner, who upon realizing that she is losing customers and revenue, decides to cut advertising and switch to cheaper ingredients.

      As a result of cutting advertising, the number of new customers drops in half and she loses even more revenue. The customers who do show up notice the food doesn’t taste as good anymore and decide not to come back. Her restaurant goes out of business within a year.

      If you cut the things that actually bring in revenue to the city, and cut the things that make the city attractive to live in, you will make the situation worse not better.

      The seniors you talk about should thank their lucky stars that they live in Amsterdam rather than the numerous other surrounding cities where they would be paying more total taxes than here. Show me a city where they would be paying significantly less? Gloversville is about the only place they would pay less 🙂