By ETHAN HARTLEY The Warwick City Council unanimously approved the city's $322,881,043, FY2020 budget Friday evening after approving over $1 million in cuts to Mayor Joseph Solomon's proposal and applying those savings to reduce the draw on the city's
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The Warwick City Council unanimously approved the city’s $322,881,043, FY2020 budget Friday evening after approving over $1 million in cuts to Mayor Joseph Solomon’s proposal and applying those savings to reduce the draw on the city’s reserves from $3.5 million as proposed to about $2.44 million.
Mayor Joseph Solomon, now into his second year as the city’s top elected official since assuming the role last May, was adamant on Monday that the budget represents a step in the right direction towards a more financially healthy city.
“The work will always be to the grind stone. As you deal with one issue, another issue comes up,” he said in a phone interview. “I was very pleased to work with the city council in conjunction with the final result. This budget process has been truly transparent. I spoke to council members, they've listened to my input and I've listened to their input. Government worked and we did the optimum for the taxpayers.”
In regards to the city’s cash reserves, Solomon said that reducing the structural deficit to about $2.4 million going into next year was indicative of a “positive direction,” and said that in previous years under the Scott Avedisian administration the draw down had included numbers in the $3 and $4 million range.
“We are putting Warwick on the proper path to fiscal stability,” Solomon said.
That path still contains plenty of potential bumps though.
You can look to the city’s ever-growing other post-employment benefits (OPEB) unfunded liability, which City Council President Steve Merolla spoke about at length during one of the budget hearings after learning the annual recommended contribution had jumped from around $23 million to $35 million last year to this year. All told, the city’s unfunded OPEB liability sits at around $290 million, and no funding is being allocated towards that.
“We can't pay the ARC,” Merolla said in a recent interview. “Collective bargaining groups should be alarmed.” He added during last Wednesday night’s budget hearing that, “These issues need to come to the bargaining table and they need to be addressed…This is a math problem. This isn’t a political issue. It's a simple math problem.”
Solomon agreed with Merolla’s assessment of the OPEB problem, calling it “the 500-pound gorilla in the room” but added that Warwick is not alone in facing that problem.
“That's not an issue isolated to the city of Warwick, that's spread state wide,” he said. “But putting $50,000 or $100,000 into an account isn't going to solve that problem. I think as we address that problem, we have to do it contractually, through negotiations in bargaining with different groups.”
Solomon spoke during budget hearings about how unexpected developments led to more turmoil in the city’s operations than could be reasonably expected, including contractual disputes regarding altering the pension system for firefighters that wasn’t officially signed and resulted in an arbitration award going against the city and costing approximately $2.6 million in total, and about $600,000 this year, according to Solomon.
That the city expects more legal challenges and possible courtroom battles is reflected through a more than 115 percent increase in the city’s legal budget (primarily comprised of an increase from $400,000 to $700,000 in the professional services line). This could be reflective of the fact that the city is in lingering arbitration disputes with firefighters over their unresolved contracts for the current year and next two years, in addition to the threat of legal action from the schools. Merolla also mentioned eight active grievances that are currently filed against the city on behalf of firefighters.
And on the topic of firefighters, the council unanimously approved a $375,000 reduction to the mayor’s proposed budget for firefighter overtime, which was initially proposed at about $3.9 million. That line was budgeted at $1.2 million for the current fiscal year ending June 30, but is projected to be almost triple that cost at $3.5 million by the time that day comes.
The budget approves funding for 189 firefighters, which according to testimony is 23 firefighters short of a full complement at 212. Combining those two points, Merolla explained why the overtime budget rose the way that it did.
“I think we [the city council] agreed it was actually less expensive to pay overtime than pay new firefighters,” he said, explaining that between medical and retiree benefits, hiring more firefighters to reduce the potential overtime was not necessarily a better cost saving measure than just paying increased overtime. According to testimony during hearings, 212 firefighters would cost about $24.5 million, while 190 firefighters, including the budgeted overtime, would cost about $24.4 million.
Solomon also explained during the budget discussion for the fire department that he would not be hiring any new firefighters until the dispute over which pension system new firefighters will enter is resolved.
“As you know, overtime in the last several years was never depicted accurately. Never with a capital ‘N.’ I did my best this year to give you the true picture of what we have, so that we don’t have to deal with the unexpected. This is factual,” he said. “Until we settle that [pension] issue, we're going to make do with what we have, because those are the only resources we have.”
Finally, Solomon’s intent to fund the asphalt line at $4.5 million to continue with an unprecedented road paving program took a hit on Friday, as the council unanimously agreed to slash $500,000 from the proposal to help bring down the draw from the free cash reserves.
“I did listen to many members of the public and the council about whether we could actually get $4.5 million spent and compared that to what we have for a structural deficit, and I think it's of utmost importance that we continue to reduce that structural deficit and not rely on reserves,” Merolla said.
Still, some on the council praised the continued commitment to paving as many streets as possible.
“The previous administration was simply not making this a priority and we have all been paying the price,” said Ward 2 Councilman Jeremy Rix.
“This is a good investment,” said Ward 3 Councilman Tim Howe. “The artery of our city is these roads. That's how we get the services to where they need to go. That's what our rescue trucks, our fire trucks, our police cars, our city trucks and every commercial company that is paying taxes in the city utilizes our roads.”
The city is only projected to spend about $2 million of its $5 million budget line for road paving this current year. Solomon said this was due to the unexpected financial liabilities that the city experienced, in addition to the threat of a Caruolo Action suit from the schools, which caused the city to implement a spending freeze that temporarily including going forward with road repaving projects.
“Since that has been overcome, the freeze has been released and we are commencing with our asphalt program,” Solomon said during the DPW budget hearing last week. “We look forward in going forward with a program that this city has not seen for a multitude of years.”
Never shy to offer his opinion, Warwick resident and financial watchdog Rob Cote said that the city will not be able to spend close to the budgeted amount of money for next year.
“Although I like to see the initiative, I would like to see that the initiative was realistic and that initiative was based on some historical data,” he said. “It's not going to happen. The reason I'm saying this is not to be negative. I'm trying to be realistic in terms of the taxpayers' money.”
Regardless, DPW Director Mathew Solitro said during budget hearings last week that, between the city’s $1.9 million spent on paving to date and the approximately $875,000 reimbursement in paving costs born by National Grid – which they pay after tearing up and re-paving streets to do maintenance on their utilities – the city had paved close to 10 miles of road this past year. Solitro said he didn’t have doubts about being able to spend the budgeted money.
“To put it in perspective, over an 18-week period we spent the $2.6 million that reflects in the budget and that was a pretty aggressive time going into the winter,” he said. “Now we're coming into better seasons for paving. So, I could effectively pave from now up until December 17, restart in March or April 17 and then go until the end of the fiscal year. I'm pretty confident when I say I could spend $4.5 million, unless you want to give me more.”
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Justanidiot
if only wees had erected master taxpayers mayer. we would be seeing a budget being slashed, services increased, a car in every pot and a chiken in evry garage.
Tuesday, June 4, 2019 Report this
Former User
Mayor Solomon and the council continue to treat taxpayers as if we can't see through their very obvious attempts to fool us.
I remember his statements at the "state of the city" speech where he said that Avedisian's estimate of a $23+ million surplus was wrong because the city has since spent about $10 million of it -- while ignoring that it was the budgets that he and the city council approved that cut the surplus by that much.
And now we're supposed to celebrate that they're taking "only" $2.4 million from whatever is left of the surplus -- and ignore the $5 million per year they already took from it -- because it's better than the $3 million that Avedisian's budgets included?
And we're supposed to admire the way they put money in the paving budget and removed it -- again -- instead of actually paving roads?
And we're supposed to accept that they're giving the schools zero additional city money while claiming the opposite? (Remember, the half-million "increase" is state money, the old bond payment is supposed to be paid by the city and not the schools, and using new bond money to fix the schools does not count toward the operating budget.)
These guys are in complete control of the city. and all they do is keep trying to fool us instead of addressing the financial problems they created.
Tuesday, June 4, 2019 Report this
wwkvoter
OK Hal, so how would Mayor Hal solve the financial situation in a lasting way?
Tuesday, June 4, 2019 Report this
JamesBruder
Wwkvoter,
I believe there is money in the school budget for all the programs that are being cut. I believe the airport needs to pay ALOT more and I believe there can be good savings with the bargaining units. As for the fire department, there are a lot of great ideas that are being discussed that would be help reduce healthcare costs. The only problem, the guy in the corner office is unwilling to negotiate on any issue. How do you come to a deal when one side would rather pick little fights (that he will lose in court and spend more taxpayer money) then sit and talk. It’s unreal.
Wednesday, June 5, 2019 Report this
Former User
wwkvoter, realistically there's no way to get out of this situation other than raising taxes.
There's no way to significantly cut the legacy costs of pensions and post-retirement benefits, or to offset them dollar-for-dollar by cutting current city services.
The math just doesn't work.
My issue, all along, has been less that we're facing tax increases and more how Solomon and the city council are trying everything they can to deflect their own blame.
As I've been saying, they had the chance to approve a small tax increase two years ago that would have generated $7 million in revenue, but they didn't. Avedisian warned them about their plan, but they went ahead and did it anyway.
Now they're suddenly concerned about raising taxes and blaming him for it.
They've basically thrown out 40 years of proof that small tax hikes every year -- instead of huge increases every few years -- is a responsible way to fund a city's operations.
But they hold all 10 of the top elected positions in the city, so why should they care about how things were done before, eve if they worked better?
To answer your question, I'd replace Solomon and a majority of the city council with people who are less interested in scoring political points against a mayor who has been gone for more than a year and trying to fool people, and are more intent on keeping the city running and limiting the impact of future tax increases.
Wednesday, June 5, 2019 Report this
wwkvoter
"realistically there's no way to get out of this situation other than raising taxes."
I'll say. Cushman has determined that even with maximum legal tax hikes every year, Warwick will slip further and further behind.
"To answer your question, I'd replace Solomon and a majority of the city council with people who are less interested in scoring political points against a mayor who has been gone for more than a year and trying to fool people, and are more intent on keeping the city running and limiting the impact of future tax increases."
Well I guess there goes your notion that "raising taxes" is the only answer.
There is the FSA - Fiscal Stability Act, and according to Rob "The Captain" Cote today on the Radio, we have met several of the criteria such as missing audit deadlines, showing deficits, and credit rating downgrade.
Here is the link, click on 6/5/19 the Captain comes on around 1:40
http://www.997wpro.com/matt-allen/
Wednesday, June 5, 2019 Report this
Former User
wwkvoter, I know my solution is unrealistic because we can't vote on anyone in office until next year.
All I'm saying is that is does nothing when Solomon and the council keep whining about the last guy and expect people to ignore their own records.
We're looking at tax increases, and we would be anyway. There's no way around it.
But it's insulting to me that these city officials are trying to distract from that truth.
None of what we're facing should be a surprise to them -- they had a hand in causing it.
Yes, I know Avedisian negotiated the contracts; I know he ran the city day-to-day; and I know he proposed tax increases every year -- but the council's job was to review those contracts, oversee city operations, and change and approved those budgets.
When they've been put on the spot about their decisions in the last few months, here's what Solomon and the city council have said:
We didn't read the contracts.
We didn't watch how City Hall was being run.
We passed the budgets he wanted (until 2017 when we passed a budget without a tax increase and left the city millions of dollars in the hole).
These simply aren't the words of the accountable and responsible people they promised to be during the last election.
Thursday, June 6, 2019 Report this
bendover
and the band played on....I am still waiting for a cogent answer for two basic questions I asked early on...Someone show me point by point where Bob Cushman's analysis of this City's spending debacle is incorrect? Number two, How was money appropriated and spent for a contract that was never reviewed and ratified by the full city council? Perhaps we will find out after the FBI concludes their multiple investigations?
Wednesday, June 12, 2019 Report this