Budget Comes Up Short by $1.5 Million

Errors and omissions in the administration's 2012 budget will force the governing body to find ways to come up with an additional $1.5 million or more in revenues, a City Council discussion revealed Thursday.

A state review of the budget statement introduced in March revealed the flaws, consultant David Kochel said. Errors included $550,000 allocated for various kinds of insurance when the actual amount should have been $1.7 million, Kochel said. In addition, individuals were left out of the budget, including a prosecutor and Municipal Court staff as well as police personnel.

Adjustments must also be made for salary increases due to union settlements. Former CFO Ron Zilinski put less in the 2011 budget for retroactive pay than was adjusted, Kochel said. Even 2011 employees who have since left must receive the retroactive pay for that year, he said.

The budget had come in below two state-imposed caps, but now, he said, "When you add up all things, it is well over the spending cap."

Kochel also expressed concern about the tax rate, but he did not have the current one and so could not project the impact of the shortfall. Storch questioned whether layoffs might be needed, but Kochel said the personnel and civil service process was so long, perhaps 60 to 90 days, that savings would be minimal..

The revelation followed a calm start to the meeting. Council members Cory Storch, William Reid, Rebecca Williams and Council President Adrian Mapp were present and Annie McWilliams, Vera Greaves and Bridget Rivers were absent. Public Works & Urban Development Director  Eric Jackson was standing in for City Administrator Eric Berry, who is off until June 2.  Finance Director Al Restaino was absent due to his mother's surgery. Three members of the Citizens Budget Advisory Committee attended the meeting.

 Those present began by discussing the timetable for budget adoption, which had been projected for late May. But once the glitches were revealed, talks became more heated. Reid asked how the errors happened and questioned the roles of the chief finance officer and city administrator. He attempted to excuse the mayor, but Storch said, "Councilman Reid, you know better," and said the mayor has the ultimate responsibility for the budget.

"Nobody should run for mayor unless they know what they're doing," Storch said.

The CBAC began attending six budget sessions starting April 12, but when member Jan Massey found out the administration knew of the errors by April 5, she said the committee would have taken a different approach had they known.

"What a waste of time," Massey said.

With budget deliberations concluded, the CBAC was at the point of formulating its report to the council.

In light of the new information, the council's Finance Committee will now meet at 5 p.m. May 29 before the 7 p.m. Ward 1 Town meeting. Plans call for a special meeting on May 31 at which the Finance Committee will present its recommendations to the full council. At another special meeting on June 6, the council hopes to adopt amendments. The agenda-fixing session is June 12 and the council hopes to pass the budget on June 18.

Among choices to bridge the budget gap, the governing body may use surplus from the six-month transition year and Kochel said he will be looking to trim non-salary expenses. The mayor's proposed 40 percent cut in library funding may also come up again.

"Quite frankly, to me this budget is such a mess ... I can't make sense out of what we have in front of us until we put all the numbers together," Mapp said.

--Bernice