Dissension in the ranks among council majority?
There has been little doubt since Republicans took control of the Troy City Council and Democrat Patrick Madden was chosen as mayor last November that the process for putting together a 2017 city budget would be contentious and political.
With the city facing financial issues not seen since the mid-1990s, when officials had to issue more than $50 million in bonds to keep the city from going broke, and state Comptroller Thomas DiNapoli early this year issuing a blistering report that said previous administrations and councils over the past five years had only added to the problem through irresponsible budgeting, the air in City Hall has been charged with partisan politics even before the new mayor and council took office on Jan. 1.
The leadership of the council have barely missed an opportunity to lay the blame on the other side of the political aisle, even though former Republican mayor Harry Tutunjian was at the helm for part of the five-year period examined by DiNapoli’s office. Meanwhile, Madden has been loathe to making the issue political, sticking to a standard line that both parties share in the blame and have to work together to come up with a solution that best serves the people who put them in office.
But now, as the time for talk ends and the time for action begins — the mayor is due to present his proposed budget no later than Oct. 10 — there are some signs of a possible rift growing within the council majority. While council President Carmella Mantello has been questioning practically everything Madden has done relating to the city’s finances over the past nine months, including a series of forums he hosted this month to explain the situation to the public, several of her Republican council colleagues are saying privately that they are tired of her politicizing the dire straits the city is in financially.
Some have even gone as far as to say they would at least consider supporting the mayor if he offers a sound plan to get the city out from under past deficits that have drained the city’s fund balance — essentially the city’s savings account — to a dangerous level and their leadership offers little more than partisan criticism and no tangible solutions. Given that the GOP holds a 6-3 majority on the current council, it would only require two Republicans to jump ship to give Madden the support he would need to get his plans approved, so there should be at least some cause for concern among the council leadership.
Nobody is denying that the situation is potentially grave. The fund balance at the beginning of the year was estimated at about $2 million, $9 million less than at the beginning of 2006. That’s well below the $6.8 million recommended by the state Comptroller’s Office and could be less than the deficit the city faces at the end of this year, leaving it essentially broke.
A similar situation faced the city about 20 years ago and led to the issuance of those bonds to keep it from going bankrupt. Madden says he wants to avoid a repeat at all costs because of the lasting impact of repaying that debt, which currently accounts for nearly 10 percent of all general fund spending and won’t be paid off until 2022.
What that likely means, according to the mayor, is that some combination of a property tax increase and service reductions will be needed just to keep the city afloat. As both sides have agreed, the chickens have indeed come home to roost after years of what DiNapoli said was the routine underestimating of expenses and overestimating of revenues by both past councils and mayors, leading to the need to reach into that fund balance almost annually to make up for deficits at the end of previous budget years.
The result of raiding the piggy bank, the mayor said, was reducing tax increases paid by city property owners by just 4 percent. Not cutting taxes by 4 percent, but simply reducing the size of those increases by 4 percent. To illustrate, 4 percent of the average property tax increase in the current budget of 4.97 percent would have added just a few dollars to the average tax bill, while years of, as Madden calls it, “kicking the can down the road” could prove much more costly, both in the short-term and the long haul.
Setting aside the political rhetoric, the likelihood of balancing the budget without taxpayers feeling some pain is about as likely as me playing second base for the Red Sox — as much as we’d love it to happen, it would take nothing short of divine intervention to become reality. The only real question to be answered is how much of that pain you’re going to feel in the pocketbook and how much in cutbacks to the services you’ve come to expect from the city.
Many, if not all, of the members of the GOP council caucus understand and accept that reality, with some saying they will go along with whatever they think is in the best interests of the city and its residents, no matter what the political implications are. Whether that may change once the council starts meeting next month to go over the mayor’s budget proposal is anybody’s guess in a city where politics is as much bloodsport as community service. There’s at least a chance, though, that the threat of defections among the council majority may lead both sides to put aside political considerations and agree on a plan that best positions the city for the day when those bonds are retired, leaving the city millions of dollars it could have otherwise used to keep those annual tax increases much lower, and the ongoing surge of development continues to add to the city’s tax base.
But then again, I’ve been wrong before, so stay tuned. Between the Lines appears every Tuesday in The Record. Mark Robarge can be reached at 2908362.