WPCNR QUILL & EYESHADE. Financial Trend Commentary By John F. Bailey. September 20, 2006 UPDATED: After the shock of having seen their former Budget Director appointed Budget Director for Westchester County yesterday, the City Budget and Management Committee, Chaired by Benjamin Boykin, and made up of Councilman Arnold Bernstein, and citizens Timothy Sheehan, Eleanor McDonald, Patrick Austion, Theodore Peluso, and Joseph Lenchner, will met Wednesday night to get -- maybe, must maybe -- a picture of how the city really finished 2005-2006 and to find if we have another surplus or not – or a deficit due to a shortfall in revenues in the last quarter. As a reporter hungry for the financial meat of the city, of which only meagre portions are placed on the reporter's plate at any time, and a taxpaying citizen, I hope so. (Update: They didn't).
Last September, the city was boasting of a surplus created by treating a state loan as an asset. With the number of closings taking place on Trump Tower and home sales, the city may very well luck out again with mortgage tax windfalls meeting and exceeding the budget.
What new financial strains will they be confronted with tonight coming in over the transom?
The financial flying by the seat of your pants that the city has been operating on the last two years is the direct result of financial reporting that is not timely, that is not made public at opportune times.
Here’s what we know so far about 2005-2006: The Renaissance is Working
but not fast enough.
The Mayor’s Office confirmed to WPCNR in mid-August the city sales tax for the final quarter of fiscal year 2005-2006 met its budgeted figure, finishing at $41,886,267, falling a mere $63,733 shy of the 2005-2006 budget projection of $41,950,000.
City Hall Commissioner of Finance, Gina Cuneo-Harwood told WPCNR then the city received $9,374,687 in sales tax for the fourth quarter, this figure is down 2.6% slightly from the fourth quarter of 2004-2005 when the city received $9,632,210 in sales tax. Asked in August, if the city accomplished a surplus for 2005-2006, Harwood said “We do not know that yet.”
City Sales Tax Revenues , according to WPCNR calculations rose 2.3%, from 2004-2005 to 2005-2006, from 40,929,781 to $41,886,267
The City’s 2006-2007 budget has projected $42.5 Million in sales tax for 06-07, relying on the injection of $800,000 in new Wal-Mart sales taxes, for the increase. If “the Big W” comes through without cannibalizing Target, Macy’s and Sears sales, the sales tax should hit $42.7 Million in 2006-2007.
Prior to the Mayor’s Revitalization Program for the city, sales tax collections stood at $35,787,758 at the end of the 2000-2001 fiscal year. After six years sales taxes have risen to the $41,886,267 level, or 17%. Sales tax receipts first increased substantially from the 2000-2001 doldrums (as a result of the redevelopment) in 2003-2004, climbing to $37.7 million.
The White Plains Renaissance has helped get the city economic engine going again, but it is the expected expenses of infrastructure and the voluntary choices the city government has made that is causing expenses to run ahead of revenues.
WPCNR hopes the city is in for no surprises tonight and some good news.
Just a few of the surprises that could be coming and perhaps be revealed this evening:
1. Police overtime.
2. The cost of the city dump bond.
3. The cost of overtime from three massive storm cleanups in two months by the DPW, (got to be at least $500,000 to a Million, before they have even cleaned up one snowstorm)
4. Tax certiorari settlements to come, with the necessity of making up the decline in the assessment roll, but of course.
5. Did the city collect all of the $2.9 Million in land sales on Railside Avenue that was needed to fill the budget gap?
Because these kinds of possible "surprises" are never talked about until they happen, the budget planning is "seat-of-your-pants."
It is a mystery why six intelligent Common Council Members do not take a more direct, "need-to-know" stance on the financial progress of the city. It is why they wind up every spring making decisions that provide a quick fix. They may not be consulted by the Mayor's financial planners, of which there appears to be only one at the present time, Ms. Cuneo-Harwood. But, that does not relieve them of the responsibility for demanding pinpoint snapshots of the city financial situation by checking all financial instrument readings during the course of the city's financial flight year. Though the Finance Department according to the City Charter is only required to put out a budget report once a year, the budget situation should be published quarterly for all to see.
The council has no excuses this year for not being better informed on the financial situation in the city. And, to be discussing the developing financial windfalls and pressures and what to do about them now, not in April when they will once again wring their hands and slap on another 8% in taxes with the School District's standard 8%.
Let’s hope those mortgage taxes just keep on coming.
