OIB commentator John Marshall Lee is a relentless digger of information regarding city finances. He questions whether the city’s in as good shape financially as city bean counters claim. We’d be happy to hear from city finance officials if they want to dispute Lee’s claims: Lee commentary below:
City Budget 2011: Deficit–$2.5Million or $10 Million?
It’s Labor Day, 2011. I was spending some time looking at a variety of reports and documents I have collected regarding Bridgeport financial standing. Specifically I was reviewing the eight month 2011 budget report released on March 29 and the eleven month report released late in August. (Ignore for the moment the City has not filed either June 30 “trial balance” or full report, which per the City Charter was due on the fourth Friday of July.)
I was troubled in comparing 8 and 11 month ‘budgeted, actual, and projected line items’ inasmuch as it appears several expense line items from the 8-month report were deleted, across the board, from one departmental report in the 11-month report. The impact of missing expense line items would be to ultimately lower a deficit or increase a surplus, all other things considered.
So I went to the beginning of the report, the revenue side of the budget. The largest revenue item in the City budget is Line Item 41693 CURRENT TAXES: REAL ESTATE. The 2011 adopted and modified budget placed that sum at $259,827,624. Eight months into the year, at the end of February, that sum was reported at $251,706,074. The City projected they would raise $10,481,230 in the months of March, April, May and June to create a year-end surplus of $2,359,680 in that line item. No variance report, however.
The City of Bridgeport claims in its heading: “Any revenue that is known to have a significant variance by the end of the fiscal year has been indicated and explained below.” As a taxpayer observing so many out of work, with so many City homes having lost value or under threat of foreclosure, actual increase in property tax revenues is good news as well as somewhat unexpected. What is the City doing to increase year-end tax revenue variance?
So I turned to the 11-month report for Line Item 41693 and discovered the City had indeed collected $257,904,122. Very close to their annual goal, with 30 days to go. So far, so good. However, the 30-day projection now showed a projected $11,006,183 in June before the fiscal year close, creating a year-end surplus of $7,282,016. Time for celebration? Time for a press release? What would Fitch Ratings say about this splendid projected accomplishment? I don’t know. But there was no variance report, once again for this line item. Curious? I think so. Were 2011-12 taxes paid early by some people in June and reported a year early? What is the explanation of the projected variance?
Consider the City ended the 11-month report with an overall total $2,356,831 projected deficit. All by itself, realization of tax revenues in 12 months of projected magnitude could have erased 75% of what is otherwise nearly a $10 Million deficit for the fiscal year. Fitch would not have been pleased to write their August 11, 2011 letter based on 2010 Fiscal Year information and endorse a sense of progress in City turnaround. And a $10 Million deficit would do nothing to enhance Mayor Finch’s run for re-election either.
Where is the tardy June 30, 2011 report? Did 2011 show a City budget surplus or deficit? How much was the variance and why? Taxpayers of the City, ask those who are looking for your vote. Someone in City government must have an accurate answer.
Off topic: No one can be happier than Denise for this fair ruling.
www .ctpost.com/news/article/State-Treasurer-Denise-Nappier-should-not-have-2160748.php
English please? Is Mayor Finch lying when he says there is surplus?
johnb // Sep 8, 2011 at 12:06 pm
to your posting
johnb,
YES … YES … YES!!!
In the words of Rick Torres, “It’s time to storm the castle.”
Observing the March through May financials that displayed a $2.3 million deficit. How do you budget and say in 11 months you have collected only 65% on a leased property and then say in your suppositions you are going to collect the remaining 35% in month 12?
Sounds more like a Finch Rating than a Fitch Rating!
Follow the Money // Sep 8, 2011 at 12:35 pm
to your posting
Follow the Money …
Consider the Fitch rating of Bridgeport is the lowest of all the Connecticut towns that are rated by Fitch and consider it was the esteemed Fitch rating agency that gave high marks to AIG and Lehman before they crashed. Finch should be running from this firm, not embracing it. So much for his judgement ability …
I recently had a conversation with Jerry Baron. Jerry one of the few people whom I hold in high regard and give credit to for creating the $51 million balance fund reserve by the time I left the Council in 2001. Jerry sent me an e-mail asking me what happened to all that money since we stepped down. I told Jerry by my estimation we had a $25 Million-plus deficit–and growing. He responded by stating “Try three times that.” Jerry was the best choice Joe Ganim made and I trust his (Jerry’s) opinion. The BOE alone has a $25 Million deficit and it’s logical to assume this deficit would have been on the City’s side had Finch fully funded our education system.
In 2007 when Finch took over, the deficit was projected at $16 Million. At the time, the city would purchase supplies: Hand Soap; Paper Towels; and Floor Wax as examples. The City had about $5 million in supplies stockpiled in the warehouse. The first thing Finch did was to use up all the supplies and stop the practice of warehousing the supplies. This alone gives the appearance the budget is balanced by $5 Million. No longer does the city purchase supplies in bulk, thus not saving money and paying more. For about three months now, I’ve been waiting for ten gallons of floor wax to keep the floors at the Police Department looking the way ithey should. The City of Bridgeport’s finances are in the “RED” and all the bleach in the world can’t erase that. By how much? I’d say $67 Million, considering the bills aren’t getting paid and those getting paid are done with TAN money.
I went to this mornings debate at Housatonic College. The CC should be ashamed of themselves as they put Bridgeport in a bad light. There were four uniformed police officers plus two school security people at the debate. What the hell did they think was going to happen? A riot? Then they announced anyone caught clapping for a candidate’s statements will be escorted out. Well I have a message for the CC. Kiss My Ass!!!
There was no rebuttal allowed by any of the candidates so they could say anything they wanted to with very little fear of being challenged.
Where is Marie Hoffman when you need her?
Finch was challenged by MJF for reading his answer from his telephone text. Finch denied it. I watched Finch through the debates and he was using his phone to get answers to the moderator’s questions. He would keep looking down to his right where his phone was all the while slowly answering the questions.
To all the sponsors of the debates I have the following questions:
1. Why were Kohut and Torres there when this was a primary election not the general election? I could care less what either has to say until after the primary.
2. Stop asking the vanplla questions, same questions each debate.
3. CC allow rebuttal to what is said or don’t hold a debate. In actuality this debate was a waste of time.
The money Finch is crowing about is the money for unfilled jobs he and Sherwood left in the budget. That total minus benefit costs is in excess of $3 million dollars. These funds appeared in the budget proposals but are gone from the finished & published budget.
For the 100th time he did not fund pension Plan A for the past 2 years thus accumulating a debt of $60 million that will have to be paid sooner than later.
Surplus of $150,000, better than a poke in the eye for sure. However, as tc said the unfilled positions in Public Facilities had millions available so there was room, but no projection as recently as the May report, one month to go. Still very curious.
tc, we have talked about the use of seasonal workers to save on medical, pension and other benefits, but today I heard in some towns those seasonal people go on unemployment compensation for the rest of the year that has to be paid by the City. Anyone know about that practice?
And we also heard part-time Bridgeport school crossing guards get pension benefits. Any further info? Just asking. Time will tell …
Beacon, here is the Connecticut law as it relates to the construction industry which is considered seasonal:
Connecticut–Benefits paid to workers in the construction industry are calculated based on wages
earned in the single high quarter. (Benefits paid to other workers are calculated based on wages earned
in the two high quarters.) Also, state law specifies that, in determining whether or not an individual is
available for work, the individual’s pattern of unemployment may not be considered. (Not technically a
“seasonality” provision.)
Beacon I think I just found my new career. SCHOOL CROSSING GUARD: They get paid vacation days. Overtime, paid holidays, paid sick time. Not bad and if they take no sick days they get a $200 bonus. I found nothing regarding pensions. This contract was signed by our dear mayor Bill Finch.