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Left In Lowell » Blog Archive » How Quickly We Forget

Left In Lowell

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May 23, 2012

How Quickly We Forget

by at 10:32 am.

Not so long ago, in a galaxy right here at home, Lowell had the Massachusetts Department of Revenue breathing down its neck, had gobbled up all its free cash and then some, and had what was effectively a structural deficit. When City Manager Lynch was hired, we were treading water near a very dangerous whirlpool. These budgets were the brainchild of the previous CM and rubberstamped by previous Councils - likely because the budgets were so obfuscated it was hard to tell what you were voting for.

That’s what makes Councilor Rodney Elliot’s comments at the meeting this week that Lynch is “addicted to taxes” so utterly ridiculous. Far from showcasing himself as the fiscal watchdog, Elliot seems to just be fiscally forgetful - and completely blind.

Let’s remember that the property tax increases of the last few years, while not zero, were NOT increased as high as they could have been (the levy limit, and beyond) like so many other struggling communities. Let’s also recall that the mere annual costs of doing business, and delivering the same level of service, go up, not down, and that the level of local aid has been - to say the least - a little rough, despite the state holding the line as best they could. Let’s also take a look at the charts that show the slow closing of the structural deficit, to a point where a negative balance in our free cash account has gone to a pretty impressive positive. Let’s also not forget that our cost of borrowing money has gone down because our fiscal house was put in order, with ratings increases for muni bonds saving us an awful lot of money.

All that could not have been accomplished by ZERO tax increases. Empty rhetoric notwithstanding.

Elliot is ridiculous and his math is sketchy. He constantly pretends he gives a crap about budgets but really, he’s just knee-jerk-reflexively anti-tax no matter the circumstance. That sort of leadership we could live without. I’d say we’re in damn good shape if Lynch is easing off the rather moderate tax increases of the last 5 years. Our budgets are clearer and better defined, and our free cash is once again where it should be. We here in Lowell are set up for a bright future, and if all Elliot can say is “I’ll believe it when I see it” because Lynch’s budget numbers cause him to sputter to come up with a way to be negative, well, he was on the Council back in the bad old days of structural deficits and I don’t remember him being quite so hard hitting back then.

I for one am glad our property taxes have been responsibly managed, that the city keeps on finding ways to become as efficient as possible, and that this year, the property tax increase will be minuscule. But let’s face it, a few tens of dollars extra per quarter for solving our budgetary near-crisis was a small price to pay for sitting pretty in the catbird seat right now. Unlike some people, I have a longer memory and can appreciate where we’re going by looking at where we’ve been before.

Kudos to the city administration for all the hard work - I know it’s a thankless job, but some of us at least understand what you’ve accomplished.

10 Responses to “How Quickly We Forget”

  1. Joe S. Says:

    If there is waste, or unproductive costs, in the budget to be presented, then the council should identify those areas and reduce the funding appropriately.

    However, to blindly follow an ideology of no tax increase by merely punting an X% reduction back to the manager is a dangerously lazy way for a board to act.

    When the depletion of the reserve fund occurred several years ago, it was councilor Elliot, as fiscal watchdog, that led the charge to use those funds to reduce the tax rate. He may have been misled on what the true financial picture was at the time, but his current agenda indicates he is following the same path.

    So what specific line items include more money than they are worth to the residents of the City?

  2. djglowell Says:

    Joe, Thank you. I was going to write exactly what you did. I agree completely, Lynne, this wole zero tax stuff just aims at the lowest common denominator of politics and is, as Joe said, the lazy way out.

  3. Prince Charming Says:

    Doctor No is just making himself look foolish. It doesn’t bother him that he’s on the losing side of every fight? He’ll continue to carry the paper’s water and they’ll chew him up and spit him out when they’re done with him. Some people never learn. It seems like Mendonca is positioning himself to carry the mantle when Dr No crashes and burns. CC Kennedy is not too far behind. Three big disappointments.

  4. Mr. Lynne Says:

    What mantle? If you’re talking about the mantle of ‘fiscally responsible’ councilor, he’s been doing that from the beginning it seems to me.

  5. Prince Charming Says:

    There’s fiscally responsible and then there’s pandering. Mendonca’s straddling that line.

  6. Jack Says:

    I find Mendonca to be consisent in his approach to the city finances. I do grow weary of parrot points like, “Lowellians aren’t getting raises.” Come on, Joe! You are smarter than that. Leave the pablum to the Toxic Twins.

  7. joe from Lowell Says:

    Look, all I want is lower taxes, more police, smaller class sizes, new school buildings, the sidewalk on my street replaced, and a balanced budget.

    Fiscal responsibility!

  8. Jack Says:

    Adding to JfL:
    *shrill voice*
    Mr. Manager. I get calls! People are asking me, ‘Why can’t the Manager do this? Does he even care about Lowell?’ I’m just asking the questions the people want asked.

  9. ax41 Says:

    Free cash is an accounting artefact ; you really can not make a value judgment about it or use its mere existence to measure performance .
    For example , if the administation projects the use of 250,000 gallons of gasoline in a fiscal year and estimates the cost of at $4 per gallon , that line item would be $1,000,000. If for extraneous reasons , the price of gasoline is only $3 per gallon that fiscal year, then the account would be in surplus by $250,000. If all other line items were exactly as budgeted , the City would show $250,000 in free cash .
    That might be a “good thing” , but it is ultimately the result of an erroneous prediction .
    You would have dig into the numbers each cycle to discover the source of the surplus; otherwise you would left arguing that in 2002 when free cash peaked at over $15 million the City was better managed than today .

  10. Joe S. Says:

    Agree with ax41 about free cash. I think the original post should have indicated stabilization fund, or reserve fund, rather than free cash.

    But with the substitution of stabilization fund (or reserves) for free cash in the original post, the point being made is valid. As for why the stabilization fund was so robust in 2002, we probably should look at the level of State aid provided in the years leading up to that.

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