City Council Candidate Responds to Claim That Glen Cove is on Track For Surplus

Philip Pidot, a Republican City Council candidate, says he has been looking into the City’s mid-year budget evaluation since it has gone public.

Below is Pidot’s response to Glen Cove’s claim that the City is on track to operate at a surplus by the end of the 2015 fiscal year. (click on the link to read more about the City’s mid-year budget evaluation.)

• • Have an opinion on this response or the City’s budget evaluation? Sound off below.

Written by Philip Pidot:

Did you hear? Glen Cove is running a surplus. Hallelujah!

And there was no classified information in Hillary Clinton’s emails.

An uncritical read of the City’s mid-year press release trumpeting a possible budget surplus by year-end leaves one feeling confident (or maybe less apprehensive) about our leadership’s fiscal management. But dig into the numbers a little, and the story changes.

I do mean “a little” because the actual mid-year financial statements are not available to the public without a FOIL request (which I did on Thursday; the city clerk has promised a response by September 10, primary day).

Meanwhile, some points worth considering, in absence of all the numbers:

• The city enjoyed one-time windfalls in the first half of 2015, including $750k in legal settlements (through what the City calls “aggressive settlement” of pending suits), which are booked as revenue. Any hoped-for surplus is presumably wiped out and then some if you back out even this one non-recurring item, meaning the fiscal ship is by no means righted.
• The mayor touts on the Accomplishments section of his campaign website that this ostensible fiscal responsibility enabled the City to avoid short-term borrowing in 2014 and 2015. (In a post below, I documented that this simply isn’t so. We issued more than $18 million in short-term debt in 2014.)
• Our helpful City Comptroller confirmed for me today that so far in 2015, we’ve not only rolled over that debt with new short-term debt (at least $11 million worth, judging by the maturity schedule), but that we’ve had to issue additional new short-term debt on top of those rollovers (couldn’t pinpoint the number, but something shy of $5 million). Up to $16 million in short-term debt issued. Through June.

For a City running a surplus, we’re sure racking up a whole lot of new debt. If we’re fully financing our expenses with revenues, why are we borrowing more and more when we’re already flirting with a junk credit rating? And keep in mind interest rates are likely going up later this year. So when we roll over all this new debt in the first half of 2016, it’s going to be even more expensive to do so.

I’ll have more on this issue once I get copies of the actual quarterly reports. Here are some of the questions I’m hoping to answer:

• Exactly how much new debt have we issued so far in 2015?
• How big a deficit are we running when you back out one-time items?
• How much more are homeowners and businesses paying in taxes than last year? (They were budgeted to be paying $500,000 more, despite claims of lowering or holding the line on taxes.)
• Going forward, can the people’s financial statements be made publicly available when prepared, rather than only via FOIL request?