SUE CARMEL’s BUDGET UPDATE TO COUNCIL FINANCE SUBCOMMITTEE SPELLS OUT THE BAD NEWS, BUT AS AN ADMINISTRATIVE, MERCENARY LOYALIST, THAT BAD NEWS MEANS ‘THINGS LOOK GOOD’ … UPDATE QUANTIFIES ANOTHER WAY IN WHICH THE TAXPAYER IS BEING HOSED UNDER BIANCHI, ‘THE AMAZING TRANSPARENT MAYOR’
By DAN VALENTI
PLANET VALENTI News and Commentary
(FORTRESS OF SOLITUDE, THURSDAY, JAN. 3, 2012) — Budgets are meant to be fluid documents. Yeah, said the wise guy, to be pissed all over.
A budget represents one’s best guess about the relationship between projected income and projected expenses. With boatloads of historical data, the economic trends of both households and governments can be known to a large extent, making budgeting a worthwhile and realistic exercise in fiduciary discipline — if, that is, the budgeteer truly wants an accurate picture.
While that is almost always the case for Mary Jane and Joe Kapanski when they plan their personal budgets for a new year, it is almost never the case of government budgeting. The private citizen, who actually faces serious accountability issues when it comes to money, wants an accurate estimate of income versus outflow. If Mary Jane and Joe run up unmanageable debt, they end up bankrupt. Government, contrarily, doesn’t care. It faces little accountability for its actions, or haven’t you heard: the bums in Washington want to raise the debt ceiling again, from its present $16 trillion.
Each approaches the question of income vs. expenses in an opposite and variant way. Talk about your converse and perverse relationships.
The Budget Process of Mary Jane and Joe Kapanski
Mary Jane and Joe first look at projected income. They ask how much money can they realistically expect to receive in 2013. They look at salaries, interest and dividends if any, and estimates of serendipitous funds. Only after doing that do they have an estimate of what they can spend. Often, when the economy isn’t doing so great, they must cut back. Instead of going away on vacation, they stay at home. Instead of trading in for a new (and needed) vehicle, they try to squeeze one more year out of the clunker. They eat chicken instead of steak, rice and beans instead of chicken. They do this so they will have the resources to meet the basic needs of food, shelter, and clothing. They are adults. They are responsible.
How Government Budgets
Now look at how government does it. First, governments estimate spending. They do so based on wish lists that include things like unaffordable salary hike, purchases that aren’t necessary, and other wastes, each propelled by a political rather than an economic interest. Only after each department submits its budget requests does government worry about raising the money. Politicians love sending unnecessary money to departments because it secures votes. They love to spend, spend, spend, because they conceive of money as their money and not the taxpayer’s.
Government never worries about income or coming up with enough dough to fund all the GOB wish-lists. Government has what Mary Jane and Joe do not have. It has The Taxpayer. Need more dough? Raises taxes. It’s as simple as that. Year after year, government in Pittsfield continues to budget this way. The result is year after year of rising government costs and prohibitive tax hikes on homeowners and government.
Consequently, the city has become unaffordable to the Kapanskis. If you haven’t noticed, in a short period of time, the population of the fair city has gone from just under 60,000 to the present count, which is at or just under 40,000. The downward trend continues. Add it up: Shrinking tax base + yearly increases in government spending = insolvency.
Case in Pojnt: Bianchi’s First Budget
Case in point: the FY13 municipal spending plan submitted to a compliant council by Mayor Dan Bianchi on May 31, 2012. The unimaginative Bianchi took Mayor Jimmy Ruberto‘s last porcine budget and added $3,585,667. So much for all the fiscal responsibility and the dreaded “prudence” we heard from the candidate during the campaign. We also recall precious little from Bianchi in the campaign that he would be raising spending by nearly $3.6 million. Bianchi has become “The Amazing, Transparent Mayor.”
Pittsfield’s Deceptive Accounting Practices
In his letter to councilors outlining the budget request, Bianchi said, “I began the budget process months ago at City Hall, when I asked all department heads to develop two versions of their spending plans: one which [sic] was level funded and a second which [sic] included a 5% decrease over last year’s budget. In both scenarios, I asked staff to ensure that the delivery of taxpayers services remained their top priorities. I anticipate a slight increase in the tax rate, achieving a budget that remains conservative, enables us to continue with valuable projects, and provides protection against unanticipated events.”
In this bureaucratic mouthful, Bianchi doesn’t account for the possibility of what actually happened: A 2.77% increase in spending. It’s all part of the deceptive accounting practices in the city of Pittsfield, which year after year provides numerical audits but not management audits of the taxpayer’s precious money. That, too, is part of the problem: The instant a candidate becomes elected, the money of government transforms. It goes from taxpayers’ money to “my money.”
The phony continuation of this process recently occurred earlier this month when city finance director Sue Carmel presented to the city council’s finance subcommittee a review of the budget a half a year in to the fiscal year. We have seen Carmel make numerous financial presentations over the years, and not once have we walked away confident that she knows a thing about the workings of municipal money. She is to finance what Lassie was to good housekeeping, which is to say, absolutely nothing. Carmel is good at the fudging required by recent mayoral budgets, and either the Pittsfield city council keeps getting fooled or, knowing what’s going on, also plays the game to the detriment of Mary Jane and Joe.
Take a guess and choose one:
During her presentation to the city council on Mayor Bianchi’s budget request for FY13, Carmel told councilors that
( ) A. “things are hunky dory.”
( ) B. “the budget continues to waste taxpayer money.”
If you chose “A”, you are correct. Carmel didn’t put it exactly in the words of “A” but close. She told the finance subcommittee (Jonathan Lothrop, chair; Kevin Sherman, Paul Capitanio, Melissa Mazzeo, and Barry Clairmont) the year was off to a “promising start. … Overall, I think things look good for the first quarter. Overall, we’re tracking where we should be.”
“a promising start … things look good … where we should be.” How comforting. How fabricated. We’re not buying it. No one with half an independent brain is buying it.
What Carmel thinks of “where we should be” and where the bedraggled Mary Jane and Joe think “we should be” are two different places, a divergence that could come into the open in a huge way in Campaign ’13, provided a candidate emerges who TRULY wants to take on the out-of-control government spending.
How good was the fourth quarter of calendar year 2012 in the city of Pittsfield? Terriffic. Boffo. Stupendous. Colossal.
Specifically, the fourth quarter of 2012 was so good that one key measure — taxes collected by restaurants from and for meals — dropped at a rate that Carmel said would project to a loss of $2 million for the year. A two friggin’ million loss in restaurant reSomehow, that little fact didn’t make any coverage in the local Mainstream Media. Add to that the $3 million the city loses to school choice because its schools are so lousy, and you have a $5 million hole, just for the openers. This doesn’t include pension costs and debt service, Carmel told councilors, nor does it account, for instance, the 16% pay hike given to teachers.
What about the annual budget slayer, health insurance? Taxpayers currently provide 85% of the tab for city employees, an arrangement that would put most private companies out of business. Subcommittee chairman Lothrop says it’s “good. It looks like we’re on track.” THE PLANET says the split should be adjusted to 50-50, the minimum required by law. That would be equitable for both taxpayers and employees while savings the city upward to $10 million or more.
The budget problem in Pittsfield is that taxpayers and politicians-officials-bureaucrats go about fiscal planning in opposite ways. The first does it responsibly. The second does it like a drunken sailor visiting port on pay day. The two fiscal tracks are like Frost‘s two paths, divergent in a “yellow wood.” Taxpayers are again being forced on a death march along the path that is, unfortunately, most chosen.
LAY YOUR SLEEPING HEAD, MY LOVE, / HUMAN ON MY FAITHLESS ARM; / TIME AND FEVERS BURN AWAY / INDIVIDUAL BEAUTY FROM / THOUGHTFUL CHILDREN, AND THE GRAVE / PROVES THE CHILD EPHEMERAL. / BUT IN MY ARMS TILL BREAK OF DAY / LET THE LIVING CREATURE LIE, / MORTAL, GUILTY, BUT TO ME / ENTIRELY BEAUTIFUL.” — W.H. AUDEN, OPENING STANZA TO “LULLABY.”
“OPEN THE WINDOW, AUNT MILLIE.”
LOVE TO ALL.