Mayor Dan Rizzo proposed a $160.92 million budget Monday night, and informed councillors that he has made the tough decision to – for the second year in a row – dip into the Rainy Day Reserve Fund to balance the budget.
It was an overall increase of 4.3 percent ($6.6 million) over last year ($154.06 million), and the use of $2.5 million in Free Cash that had been deposited into the Rainy Day Fund earlier this year.
“It comes down to two things; you either lay off people or tap the reserves,” he told the Council. “It’s really that simple. This budget proposal makes a case for the latter…Obviously, local aid numbers (from the State) have not gone up to the extent we would like or need to keep providing uninterrupted services to our residents. We are getting nowhere near the local aid we need, nor do we have the New Growth numbers we need under Proposition 2 ½ to meet the City’s obligations…So, we have identified $2.5 million from the fiscal year 2014 Free Cash appropriation, which was a total of $3.2 million. We made this decision because we wanted to keep public safety staffing levels and to continue to provide services to the residents as much as we can…We could cut personnel or we could try to get through this with the funds I’ve identified. I think it’s a good budget.”
Local Aid projections for Revere were $8.9 million and New Growth numbers were projected at $525,000. School aid from the state was projected at $50.95 million.
Using the reserves for a second year is in stark contrast to the previous administration, which consistently strove not to touch the reserves – even resorting to cutting large amounts of personnel from City Hall on more than one occasion.
Rizzo said he wasn’t up for doing that, and noted that several other communities, including Everett, Malden and Brockton have had to use reserves and cut personnel. He said such budget headaches are not unique to Revere.
He said Malden had used $5 million in reserves to balance its budget and had cut 30 positions.
“I could go on and on about other cities and towns using reserves to balance their budgets,” he told councillors.
Ward 1 Councillor Richard Penta, who is the chair of Ways and Means, said he wasn’t concerned about the repeat use of reserves to balance the budget – especially since it was coming from this year’s Free Cash.
“That’s what reserves are for,” he said. “I’m not worried about that. The City is in really good shape if you ask me. Because this was only part of the Free Cash, the rest will go in the reserves and there will actually be more reserves than there were before.”
Other councillors seemed a little more skeptical.
Councillor Brian Arrigo – a frequent critic of tapping reserves for budgeting – had several questions queued up and asked the mayor for detailed revenue projects
“Until we pushed last year for more information, we didn’t get the information that they planned to use reserves,” said Arrigo. “At least this time, the mayor is being up front about the fact we’re using reserves to balance the budget. Two years in a row of balancing a budget on reserves is really not the long-term way towards healthy budgeting…The Commonwealth is doing a lot better now, and we’re in a better recovery than other states. It’s not raining at this point and it hasn’t been…When we’re using reserves every year, what happens to us when reserves run out?”
He also disagreed with the mayor’s characterization of Malden’s use of reserves, and said he would address that during budget hearings.
“It’s only half of the story and half the story is what we’ve gotten with this budget,” he said. “We’ve got expenditures, but not revenues…I look forward to have a detailed discussion in the coming weeks on this budget.”
No other councillors offered any immediate opinions on the budget.
Because the budget is delivered a bit late for the second year in a row (the Budget proposal typically is presented to the Council in early May for review), Penta said they would begin whirlwind meetings on June 10 to review the document. He envisioned the review taking place over four days.
Rizzo said the tight budget was a result of the City thinking within reality and not about what might be – such as with the casino proposal at Suffolk Downs.
“Things could completely change for us in 90 days, but we can’t think like that,” Rizzo said. “This budget and our vision is not hinging on casinos. We have to move forward as if we don’t have a casino and that’s what we’re trying to do here.”
One of the major spending areas was within the public safety arena, Rizzo said. That budget increased by $1.9 million to a total of $20.7 million, but it wasn’t all happy news. Rizzo said that grant funding for six police officer had mostly dried up, leaving the City on the hook for four of those salaries. Meanwhile, in the Fire Department, a federal grant for 10 firefighters also dried up, leaving the City to foot all of those salaries.
Most of the increases, he said, came in the form of meeting contractual obligations with both departments for contracts settled last year – contracts whose funding consequences were coming to bear this approaching fiscal year.
Rizzo said he was able to add two police officers to the force, but he said the department had requested four officers.
Another piece of news on public safety was that the long-awaited 9-1-1 call center for Revere and Winthrop has been delayed until August or later.
“It could come online as early as August, but potentially as late as this fall,” Rizzo said.
The Center was expected to open up last February.
Some of Rizzo’s highlights in the budget included:
•Mayor Rizzo highlighted the upcoming efforts to begin another round of funding in the Broadway Revitalization Program, and he added that he expects the Market Basket at Northgate to open in the “very near future.”
•Rizzo said he expects to revamp the Inspectional Services ticketing appeal process – making it more like a traffic ticket. He said he plans to add a Municipal Hearing Officer to the City Solicitor’s budget and resident will be able to dispute tickets locally instead of going to Chelsea Court.
•Mayor Rizzo said he was not able to hire any additional workers for the DPW, but they were able to add a mechanic to the budget this year. Rizzo said while that doesn’t equate to manpower increases, it could help work get done faster.
“That person is going to go a long way for the turnaround on our vehicles because we no longer will have to send them out to be fixed,” he said. “A lot of times, work can’t get done because the vehicles are broken…While not directly adding traditional manpower to the DPW, we feel that mechanic will be able to service vehicles quicker and get people work.”
•Another budget buster, Rizzo said, was the loss of nearly $1 million per year from the car rental surcharge fund. That came when Thrifty moved to Logan Airport’s consolidated rental car facility. The $10 surcharge applies to all rental car companies in Revere, but Thrifty was by far the largest payer. With them gone since last September, it has left a hole in the upcoming budget, as the surcharge monies were used to pay off bonded debt from the new Public Safety Facility.
•Rizzo said the new performance-based budgeting project is still a work in progress, but making strides. The City is being assisted by the Collins Center of UMass-Boston to help in transforming the budgeting process. In the end, he said it would change how the budget looks, how money is allocated and how services are delivered.
Hearings on the budget are likely to be concluded by Monday, June 16.