New Haven Independent

Posted by: jeffreykerekes | March 13, 2008 9:05 AM

I hope you all can make it to the next Finance Committee meeting on 3/25/08 @ 6pm. If you are interested in getting more involved in budget discussions, please feel free to contact me or visit our website www.nhcan.org.

Here were my comments last night:

Wednesday, March 12, 2008
Ladies and Gentlemen of the Public and Finance Committee:

I previously emailed the full BOA with a copy of our recommendations and would like to give a copy now into the official record. I will limit my comments today to the context in which this budget should be considered.

We keep hearing about the Mayor and the BOA looking to the State and Federal Government for more aid without hearing about the State's/Fed's willingness and ability to pay. Seeking these funds must be one part of the strategy but the financial realities of State/Federal Government must be part of our discussion when looking at this budget. I believe we cannot simply look at the merits of individual programs on a program-by-program basis without attending to the overall economic climate of the State, Nation, and indeed the entire Globe.

I don't want to drown you in numbers, but it is important to place your important decisions about this budget in context. The first number is that the whole US GDP is $14 Trillion. The desperate financial picture at the national level with Medicare underfunded to the tune of $80 Trillion, Social Security to the tune of $12 Trillion, national debt of $9.4 Trillion (that's $31K/household just for national debt), the Federal Government will continue to cut funding to States and therefore, the states will continue to cut funding to the Cities. New Haven citizens kick in about $200 Million to our annual City budget of over $650 Million dollars. That means $450 Million comes from the Feds and the State. We cannot ignore the financial realities facing these entities and keep spending with hopes of getting a windfall from the State or Federal Governments. We are like a person who lost their job and instead of hunkering down, keeps spending like crazy hoping that someday, they will get a new job. A great example of this is that the current budget proposal only puts in $50,000 towards a $430M liability (GASB 45). We should be doing our part towards our commitments and begin digging out from under all of our IOUs.

With debates about National & Global recession, $12 billion a month being sent to Iraq, State cuts to Magnet Schools in New Haven, $1.8 M less in our Priority School Funding, $2.3 M less in Early Reading Success funding, reduction in money from the Casinos (Pequot Funds), the suburbs fighting to change the ECS funding formula taking another $7.9 M, chronic under-funding of the PILOT reimbursement program by about 30%, escalating health care costs, underfunding our pensions ($900M) and early retiree healthcare ($430M) making the backdrop to this season's budget discussion, I want to point to some other important numbers closer to home.

We are in debt at about $1.4 Billion and our spending is increasing each year.

Foreclosures are up 80 percent in the city over the past year with over 1100 homes in foreclosure. This means families are in financial crisis. According to a recent Fitch Rating (A bond rating company), New Haven has a 7% unemployment rate as of December 2007, the $35,841 Median Household Income (2007), escalating energy costs, gasoline over $100/barrel and $4/gallon heading straight for us, we implore you to take a fresh look at all of these "fixed" costs to which we seemed hog tied.

Just because a pair of jeans are on sale, it doesn't mean we must buy them. If we go grocery shopping at BJs and save 40 cents per stick of butter but need a dump truck to transport it home, does that make it wise? The city feels compelled to spend a certain amount to get the State Education match. If we spent less, we would get less money from the State, but we would still spend less - save money. This is what happened with New Haven creating the largest school construction program in the country. We saw the words "education sale" and wound up spending more than we could afford to the point of paying to build schools in other towns with our tax dollars. I was recently at Celentano school library hearing about the future of the City but there were no books on the shelves.

We recently heard about the $17 million shortfall this year and we also had a shortfall of millions last year. How much will it be this new budget? This budget is projecting millions more in PILOT money. How does this hold up to recent experience?

Recently, the State's surplus is reported to be down $60 Million due to negative trends and erosion of revenue in Income Tax Refunds, Inheritance Taxes, Insurance Company Taxes, Real Estate Conveyance Taxes, Lotteries, Investment Income and Motor Fuels Tax Revenues.

We are resorting to Enron like schemes trying to move our debt off the books to make it look better but still keeping us on the hook for Millions. We are only throwing $50,000 at $430 Million. I am concerned and you should be as well.

Posted by: another one bites the dust | March 13, 2008 9:50 AM

Jeffrey,

We her that you just joined the evil empire. Good luck to that. You will never be able to change the system from the inside. You should have turned down the appointment to that useless commission. How much does it cost to staff that thing?

Posted by: robn | March 13, 2008 6:43 PM

"New Haven citizens kick in about $200 Million to our annual City budget of over $650 Million dollars. That means $450 Million comes from the Feds and the State." Jeffrey Kerkes

Hang on Jeff...I'm also completely frustrated by federal spending priorities (thanks a lot pro-war Joe Lieberman voters) but your numbers are giving readers the wrong impression. You make no distinction between geenral fund, capital funds and special funds and you make it look like we're only self funding to the tune of 31%. In reality, New Haveners are paying state and federal taxes, some of which is returned to us. I'm not saying we're 100% self funded, but your numbers don't include the amount of state and federal tax dollars returned to us. That would be an interesting calculation indeed.

Posted by: jeffreykerekes | March 14, 2008 10:18 AM

ROBN:

You are correct. The $200 Million I reported is only money out of property taxes. The remaining amount of $450 Million are from Federal Taxes and State Taxes. If you pay those taxes too, the money is just coming from another pocket. Our liabilities far exceed our $650M operating budget which means they already have their hands on your future tax dollars as well.

The War Resisters League have an interesting chart which shows where your federal dollars go.

The National Priorities Project will tell you exactly where your tax dollars go if you enter in the amount of income tax you pay. They also have many other interesting charts there worth looking at. According to their site, Taxpayers in New Haven, Connecticut have paid $254.3 million for the Iraq War thus far. For the same amount of money, the following could have been provided:
84,003 People with Health Care OR
313,915 Homes with Renewable Electricity OR
5,016 Public Safety Officers OR
3,403 Music and Arts Teachers OR
30,405 Scholarships for University Students OR
10 New Elementary Schools OR
1,218 Affordable Housing Units OR
97,616 Children with Health Care OR
35,293 Head Start Places for Children OR
3,510 Elementary School Teachers OR
3,090 Port Container Inspectors