The Cost of State Senate Inaction: $183 Per Year, Per Household [City of Long Beach]

Taken from longbeachny.org:

The Cost of State Senate Inaction: $183 Per Year, Per Household

Given the City’s inherited fiscal deficit, the new administration initiated a thorough and thoughtful budget process — working around the clock scouring the budget, line-by-line, to find potential savings. Through significant spending cuts and personnel savings, the City passed a balanced budget for 2012-2013. However, the City still must pay the cost of the deficit it inherited from the previous administration.

State Senate Majority Leader Dean Skelos Let Long Beach Taxpayers Down

  • State Senate Majority Leader Dean Skelos did not pass the routine deficit financing bill that he sponsored, nor did he even bring it to a vote.
  • An identical bill sponsored by Assemblyman Harvey Weisenberg easily sailed through the State Assembly with overwhelming bi-partisan support 134-6.
  • The deficit financing bill would have been no cost to the State.
  • Had the State Senate fulfilled our request, the City would have been able to pay out the deficit over 10 years instead of 3 years.
  • The bill would have saved each taxpayer approximately $183 a year for 3 years.

What State Senate’s Failure will Cost Long Beach Taxpayers: An Inherited Deficit Surcharge

  • An additional $183 a year for 3 years
  • Not a permanent tax increase, temporary surcharge to pay off the inherited deficit

How Did We Get Here?

The previous administration ran a multi-million dollar annual deficit, culminating in 2011’s estimated $10 million deficit. In December 2011, the previous administration was unable to make payroll after completely depleting the City’s reserves. This caused an unprecedented and alarming five-level downgrade of the City’s bond rating by Moody’s Investors Service. After years of mismanagement by the previous administration, an extraordinary financial burden was left for residents to pay. The previous administration was responsible for:

  • Wasteful overspending (“no purchasing requests were ever denied”)
  • Hiring unfunded positions (e.g., five firefighters late last year)
  • Unfunded promotions (the current administration rolled them back earlier in the year)
  • Hiring more part-timers than necessary (there was a dramatic increase in 2011)
  • Over-estimated revenues (every year)
  • Under-estimated expenses (every year)
  • Exorbitant overtime (the current administration instituted a strict pre-approval procedure in January)

The current administration’s fiscal responsibility has reduced the size of the inherited deficit by several million dollars.

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3 thoughts on “The Cost of State Senate Inaction: $183 Per Year, Per Household [City of Long Beach]”

  1. At first, I could not believe what I was reading and how one-sided it was, then I realized I read the same thing on the city of Long Beach website and attribute it directly to the master of budget disguises Mr. Jack Schnirman. You had me going for a minute Anthony…
    I implore you to please post the letter that Dean Skelos “penned” in response to Schnirman’s accusations against himself and the legislature.
    Please post the other side to this one-sided self-serving post by Mr. Schnirman…

  2. Below is Dean Skelos’ response to Jack Schnirman’s assertion that Dean Skelos is responsible for Long Beach’s current fiscal issues..

    “I have read City Manager Jack Schnirman’s recent letter regarding the City of Long Beach’s ongoing financial problems and I continue to be troubled by his insistence on borrowing to address these problems, rather than following the state’s example of spending reductions and belt tightening.

    As he is well aware, there were two legislative requests made of my office. The bill that he references in his letter would have provided authorization to issue up to $15 million in serial bonds —$5 million more than the projected deficit, according to documentation provided to my office. That’s not just kicking the can down the road; it’s borrowing money to buy more empty cans.

    This request would place the city’s current budget problems on the backs of Long Beach taxpayers for years to come. Mr. Schnirman has yet to take adequate steps to responsibly address the current fiscal dilemma, nor has he provided me with a legitimate plan to reduce expenses and balance the budget.

    Long Beach was not the only locality that sought legislation to authorize borrowing to close a budget deficit. The Senate refused to approve similar requests from other localities. In addition, we did not act on any requests to raise local sales taxes regardless of whether they came from Democrat or Republican administrations. Taxpayers have simply had enough of increases in spending, taxes and borrowing.

    I urge Long Beach to follow the example I have set at the state level. Mr. Schnirman talks about inheriting a large budget deficit, yet when I became Senate Majority Leader, I worked with Gov. Andrew Cuomo to close a $13 billion budget deficit by passing two budgets that reduced spending, and did not raise taxes or include any additional borrowing. We relied on fiscal responsibility, streamlining government and making tough decisions on state spending.

    In addition, I inherited a Senate operating budget that was $13 million in the red because of reckless overspending by Senate Democrats. Not only did I work to close that gap but also this year, the Senate is operating at $11 million under budget.

    Long Beach should follow this example, rather than seeking a state bailout and taking on additional debt. The city manager’s recent decision to bond out an additional $5.6 million dollars for capital improvements while failing to address a growing budget deficit flies in the face of logic. And that he would now try to blame me for potential tax increases brought on by his inaction is absurd.

    As Mr. Schnirman is also aware, the second bill he requested was passed and signed into law by the Governor. This bill provided the city with legitimate relief in helping to reduce labor costs and save Long Beach millions of dollars over the coming years. This fiscally responsible legislation enabled the city to benefit not only from a net positive cash flow, but based on his statements, will actually save the city $1.5 million per year. I am pleased to see that the City Council recently acted on these incentives.

    Over the past few weeks, I have spent time in Long Beach at various events, speaking directly with many constituents and community groups. While I have heard concerns raised over the current financial situation facing the city, even more have expressed concern over the city’s seemingly non-stop borrowing over the past year, primarily under Mr. Schnirman’s leadership.

    Some people have even raised the question as to whether a financial control board, similar to ones created in Buffalo, Troy, Yonkers and Nassau County, would be appropriate if he cannot bring spending under control.

    I look forward to hearing from the city manager and, as always, remain open to

    helping the City of Long Beach in any way that I can. Over the years, I have worked tirelessly on behalf of residents of Long Beach. I have secured millions of dollars in state aid to Long Beach Schools, Long Beach Medical Center, city government and to countless community groups and nonprofit organizations that provide some of the best services in New York State.

    I remain committed to my constituents in Long Beach and hope that he will begin to take seriously the need to address his own budget shortfalls with appropriate actions, as I have done on the state level.

    Dean G. Skelos

    Senate Majority Leader”

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