To fix fiscal crisis, officials mustn’t engage in public tug of war

By the end of this week, city officials in Troy may still not know how to address financial issues that date back more than two decades, but they — and the public — should at least know the extent of the problem.

City Council President Carmella Mantello said at Thursday night’s regular meeting that a longawaited audit report from the state Comptroller’s Office is expected to be released this week. City officials already have some idea what it says, thanks to both a letter sent by the state agency back in November and a meeting a few weeks ago to discuss a preliminary draft, but this will be the first the public gets to see of the detailed examination of the city’s finances.

Nobody is expecting the news to be good, especially after that letter stated that in compiling his proposed 2016 city budget, former Mayor Lou Rosamilia underestimated expenses and overestimated revenue to such an extent that what had legally been a balanced budget could in fact result in a deficit of as much as $2.4 million, or nearly 3.5 percent of the total $68.6 million proposal. Rosamilia’s proposal was later trimmed to about $68.1 million after often-heated negotiations with the council, and an accompanying 9.3 percent property tax increase was trimmed to just under 5 percent, but officials fear they may have to take steps as drastic as a mid-year tax hike to keep from going broke.

For longtime city residents, that’s a story they’ve heard before. In the mid1990s, the city teetered precariously on the brink of insolvency and was bailed out only when the state formed what is called a Municipal Assistance Corporation to allow the city to sell more than $21.6 million in bonds to cover three years’ worth of deficits from 1993-95. While that money kept the city functioning, it saddled future officials — and taxpayers — with annual payments that will approach $6 million — nearly 10 percent of the current budget — before the debt is finally retired in the next five or six years.

While the scope of the problem may no longer be much of a surprise, how city officials respond is the question now. Under state law, the City Council has the ultimate responsibility for coming up with a formal plan to correct whatever faults the Comptroller’s Office points out in its final report. Mantello and the council took steps towards that Thursday night, agreeing to fast-track their plan to hire an auditor of their own to examine the problem and come up with recommendations for the council to consider in compiling the response, which is due within 90 days of the release of the audit.

But with new Mayor Patrick Madden and his staff also working to deal with the issues raised in the report, the question sitting out there ominously is whether the Democratic mayor and Republicandominated council will be able to co-exist within this process. Both sides pledged shortly after Election Day not to fall back into the sniping and backbiting that came to mark the relationship between Rosamilia and the prior council, even though the mayor was a Democrat and that council was controlled by the same party.

There have been some minor flareups between Madden and the council over such things as the confirmation of his choices of Monica Kurzejeski as deputy mayor and Kevin Glasheen as corporation counsel. Though both were eventually confirmed unanimously by the council, the process was delayed by nearly a month after council members said their predecessors violated the city charter when they tried to begin the confirmation process while they were still in office by pushing the nominees through their Finance Committee so the new council could take its final vote as early as its organizational meeting in early January.

If something as seemingly inconsequential as that can become a bone of contention, imagine what something as serious as the city’s financial viability could lead to. And that’s not even considering the political dynamic, with Mantello seen as a leading GOP candidate to challenge Madden when his term expires in 2019. Mantello, former director of the state Canal Corp., who briefly mounted a campaign last year for her party’s mayoral nomination, has a high-profile opportunity to position herself as the best alternative to Madden, and how she handles this crisis may be critical in determining if a 2019 campaign lasts longer than her 2015 effort.

Add to that the longrunning debate over who is responsible for the fiscal mess the city is in, with Republicans labeling Rosamilia a tax-and-spend politician and Democrats saying his predecessor, Republican Harry Tutunjian, all but depleted an $8 million fund balance to avoid passing along tax increases to voters. Frankly, though, that is a debate best left until the next mayoral campaign, as the lessons of the past will only be useful in preventing a repeat once the city does get its financial house in order.

The biggest — and, in fact, the only — thing both sides need to focus on is getting and keeping the city on a path that will end in fiscal stability once the MAC debt is finally retired and the city can count on both a one-time shot of $13 million now set aside to ensure the security of the bonds and the availability of the money now used for the annual payments on that debt. How much of that is done by cutting costs, adding revenues or even increasing taxes will certainly be the subject of great discussion and debate over the next 90 days and beyond, but how those discussions take place may be even more important to observe.

If the mayor and council choose to compare notes from their individual efforts and work together to come up with a comprehensive plan that addresses all three of those points, they will certainly have a better chance at success than if they take a page out of last year’s playbook and engage in a public tug of war. And while being “right” may be of political value come campaign time in 2019, it is just as likely to alienate voters on both sides of the aisle if the city’s leaders fiddle while Troy continues to burn financially.

While that pledge of cooperation each side made before taking office may be borne out in kind words and other niceties, if it’s not matched behind the scenes, nobody is going to walk away a winner, not Madden, not Mantello, not the rest of the council and certainly not taxpayers and other residents.