BREAKING NEWS: CITY COUNCIL PRESIDENT JOHN FRIEND EXPOSES 2014 BUDGET DEFICIENCIES

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    EDITORS NOTE:  THIS LETTER BY MR. FRIEND IS EXTREMELY TECHNICAL. IN NATURE.   HOWEVER WE URGE YOU TO READ THE LAST COUPLE OF PARAGRAPHS AT THE BOTTOM OF THE PAGE TO GET THE REAL  JEST OF MR. FRIENDS  BUDGET CONCERNS.

    Dear Colleagues

    Per the email sent to City Controller Russ Lloyd Jr.  stateing that the Evansville City Council needs some additional information concerning the 2014 Budget Fund deficiencies.  Today Russ sent me vie e-mail of the 2014 budget fund breakdown.  Attached below is a link of the Budget Fund balance changes sent to me by Mr. Lloyd.

    Originally,  I included the General, Parks & Recreation, LIT, Hospitalization, Workmen’s Comp,Liability, Unemployment, Golf Non-reverting, and Hwy Vehicle into the operational category. I took Russ’ opinion and now included funds, 202,231,251,253,270,406,407,408, and 806, the yellow marking indicators represent the operational side of the budget.

    Please notice line 98 Col I, the total operational deficiency is $9.4 million for the fiscal year ending September 30, 2014. go to col R to see that the deficiency is $9.6 million for the prior fiscal year…this is where the 2% improvement over the same period one year ago was derived. Now, the administration is saying this is after the summer and the funds are lower. My analysis isn’t analyzing a point in time (Sept 30, 2014) but changes in points in time which includes all of the high points and low points, between two points. So, do NOT be confused.

    Now, I direct your attention to line 103, col K, this is the deficiencies of ALL THE FUNDS excluding our agency funds (Funds of which we have no title) which displays deficiencies of $9,069,000. Please notice line 104, col K, deficiencies of $6,278,000 which is the changes in fund balances for the same period one year ago. This is a 44% decline in CASH or simply put $2,791,000 more in deficit spending.

    Now, let’s examine line 11 Col. G, and Line 12, Col G, representing our Police and Firefighters pension money. I direct you Col. H which is the amount of those pension funds that are invested. The total pensions equal $11,786,000 which you would expect would be totally invested, but, look at Col H, the actual amount invested equaling $8,350,000. so where is the difference? Well, it is in the same checking account that the general fund, parks, in other words, all of the operational totaling $3,436,000. Now direct your eyes to lines 5,6,7, & 66, these funds are negative by a total of $13,258,000 and must I remind everyone that we are three months from receipt of the final property tax installment as of September 30th, 2014.

    Please do not overlook lines 44, Col G & I because this is the Master TIF Fund that includes our downtown TIF Fund which has declined by 51% or $2,796,000. I have been on Evansville City Council for seven years and have NEVER seen our hospitalization fund this upside down. Our hospitalization is negative by $2,791,000 and places our employees health needs in the balance. Please notice the change is a mere $3,294,000 or a decline of 654.87%.  Can you imagine when the Affordable Care Act kicks in what the negative decline shall be?

    What seems to be apparent is that this City Council has voted on very important budget issues without full disclosure. The Administration knew or should have known that Old National Bank would be carving out $1.9 million from the Downtown TIF before we voted on the IU Medical School. This $1.9 million dollars property tax reduction for Old National Bank  represents approximately $30 million dollars of future bonding capacity. I’m not sure about others, but, this would have influenced my decision. The same goes for the Johnson Controls “Smart Water Meters” project.  Either the administration knew or should have known about the budget contingencies deficiencies placing our citizens in potentially financial peril.

    According to the email I received from City Controller Russ Lloyd Jr that Old National Bank property tax reduction in the downtown TIF was $1.9 million dollars instead of $1 million dollars. We were told (at least I was) that the downtown TIF property tax reduction was $1million dollars.

    The TIF budget for 2014 was $6.6 million dollars. When the TIF was reduced by $1.9 million dollars the value of this TIF would be $4.7 million dollars. The administration budget number was $5.8 million dollars.

    Its now reasonable to assume that the downtown TIF will go from $4.7 million to $5.8 million, or greater than a 23% increase? I would expect no more than a 4% increase or $200,000 making the difference declining bonding capacity by $9 million dollars off the budget.

    If anyone has any questions, please let me know.

    John Friend-CPA
    President of Evansville City Council

    POSTED BELOW IS THE LINK TO THE CITY OF EVANSVILLE FUND BALANCE CHANGES

    Evansville – Fiscal Sept 30, 2014 Fund Balance Changes

    This e-mail is posted by the City County observer without opinion or bias.

    Copyright 2014 City County Observer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

    RELATED ARTICLESMORE FROM AUTHOR

    38 COMMENTS

    1. All this and Winnecke is about to gain more yes men and women on the council.

      • The residents of Evansville must not vote for those “mayors boot likers” in your election next fall!

      • Weinzapfel has his yes men and women. He also had major support from the unions and the African American Community. Winnecke inherited a mess and he needs to lay everything out on the table and redeem himself.

        • You’re so blindly partisan you’re defending a dunce like Winnecke simply because he’s a Republican.

        • But the SBOA should have pointed out the mess. After all the Governor was a GOP and they were auditing the Democratic Mayor.

          So why did the GOP controlled SBOA not figure out what was going on?

          I blame both the dems and the GOP for this stupid mess. Neither of them can be trusted with the public’s money.

      • CCO, raise your bar a little bit. First paragraph, in bold, get the real JEST of Mr. Friend’s budget concerns ?

        Really ? Is Friend just kidding, or do you mean GIST ?

        And Friend is no prose writer either, his first sentence he is ‘state-ing’ (spell checker on this site wouldn’t let me misspell it, had to hyphenate to illustrate).

        COME ON CCO & FRIEND: get it right !

      • This analysis is unnecessarily complicated ! Why ?

        Just focus on the two fiscal years ended in September 2014 and September 2013. Ignore everything else.

        For OPERATIONAL Funds (Yellow highlight), our Cash Balances have declined by $ 19,021,000 over that two year period. Our Cash Balances declined by $ 9,427,000 for fiscal year ended September 2014, and declined by $ 9,594,000 for fiscal year ended September 2013 (amount on the spreadsheet for fiscal end September 2013, $ 9,625,000, is incorrect).

        Focusing on just the fiscal year ended September 2014, there were twenty-one (21) OPERATIONAL Funds whose variances added to our cash balance decline of $ 9,427,000. Applying the “80/20 Rule” of management, 20 % of the accounts (or 4 accounts) should account for 80 % of the variance. In fact, Funds 474, 408, 707 and 704 account for more than 80 % of the variance, just those four accounts are 91 % of the variance.

        We need a new City Controller. All accountants know what I just shared above. A good City Controller would have already provided the media with a 1/2 page each for these four accounts, discussing issues, repercussions and outlook. In two pages of narrative, this could have been explained in layman’s terms for the public. Fresh blood is needed badly.

    2. That is so boring and hard to understand that it’s no wonder that no one really cares what’s going on. I about fell asleep after reading the first couple of Paragraphs. But then again I don’t have to pay city taxes and it’s no skin off my nose.

      I do feel sorry for the citizens of Evansville, IN that I wonder if the SBOA really has done their job right?

      • The head of SBOA, Paul Joyce, has done all but admit that it wasn’t done right. He is claiming that his budget does not allow for the hiring of enough qualified employees.
        I can’t say I’m surprised at all by these disclosures. Nobody’s Friend must be trying to make amends with the voters, now that Tom Shetler’s son-in-law is running for his seat on City Council.

    3. Those medical providers over that crumby infrastructure assess should gripe a assessment fit, as well. What’s their assessed value per what would be installed for the IU medical campus down there in the old downtown. First in. Whew, that’s a sticker someone should stick on someone’s face as well. Considering.

      • assess….oops, Thinking it, but meant “accesses”. Edit if you feel like it, or don’t. 😉

    4. My focus point is the underfunding of $3.436 million dollars of the police/firefighters pension!!!!!!
      Throw the insurance decline as well! Protect the work force of their due diligence!

      As they said in Paris in 1789, let those shiny new city toys “eat cake”!

    5. John Friend is making a desperate attempt to say that the only reason the Council voted for all the trinkets like Johnson Controls is because ” What seems to be apparent is that this City Council has voted on very important budget issues without full disclosure. The Administration knew or should have known . . . “. That last partial sentence was attorney written, thanks Danks.

      Let the blame game officially commence. When the going gets rough, the politicos spend all their time blaming the other side, and here is the first salvo.

      • The vote for the Johnson Control thing was 7-2 against until Jack McNeely addressed the council and the vote changed 9-0 for. I’m not a Winnecke fan, but exactly what money has he spent, a million to the hotel, $200,000 to Earthscram but the real spending seems to be keeping up with what happened during the previous administration. Winnecke inherited a bucket of worms and when he looked under the bucket there was more worms. I think the problems are greater than we’re being told and are going to get worse. This whole problem goes back to the Fraud Center which started this downward spiral. Remember when they had those pseudo meetings to discuss the new arena and Bagby and his union buddies sat in the back and kept saying, just build it. Well we did, the arena is like Siberia, everyone knows where it’s at but no one wants to go. The city council knew exactly what was going on with the budget but kept it hidden and beat up on SBR for exposing them. Is this City Council job worth this level of dishonesty, deceit, and mean spiritedness. What about a little FAI from all the old timers on the Council, FAI=Follow up, Accountability, I=Involvement. I would imagine the total pay and benefits for a council member is about $50,000 year, would you please start earning your pay. People in real jobs get fired for such incompetency.

          • Council receives a good health insurance policy, as does Scott Danks in what was previously a contract position.

    6. WAIT JUST A MINUTE:

      C & P article this morning said that ONB protest dropped its property tax from $ 1.9 Million to $ 900,000, a $ 1 Million decrease annually.

      Now, Mr. Friend is reporting that the TIF (ONB) was reduced by $ 1.9 Million annually , and his source is an e-mail from Rusty Lloyd received “today”.

      Which one is it: $ 1 Million decrease ? $ 1.9 Million decrease ? Next: who’s been drinking today: Friend, Rusty Lloyd, John Martin of C & P or d): All of the above ??

      • Friend claims that the Old National change in property tax might have changed the Johnson Controls vote, if only Council had received “full disclosure” from the Administration.

        Yet, the Johnson Controls project was sold as “it pays for itself via the additional usage the meters will record”.

        Therefore, did the Council approve Johnson Controls KNOWING that the meters wouldn’t pay for themselves ? Otherwise, the ONB property tax should have ZERO to do with the Johnson Controls vote . . . Mr. Friend needs to elaborate on his slip of the tongue, I believe.

    7. Friend is getting EXACTLY what he, O’Daniel, & Adams deserve: they elected NOT to take on the corruption associated with the State Board Audit, allowing a $ 29 Million plug and collusion between City and SBOA in changing the audit opinion . . . . and now Friend comes back to the well and proclaims that Council’s votes were made “without full disclosure” by the City administration ? Well, duh, . . . do you think if the administration has so little fiscal integrity that they lied to the public about the 2012 SBOA audit they’re not also going to lie to Council about our current financial situation ? What about that negative trend on the Waterworks Bonds from S&P–when was the public going to find out about that one ? This sounds like Friend’s day of atonement for his sins, but Yom Kippur was way back on October 4th . . .

    8. The deeper this gets the more likely it looks that there is actionable criminality involved. This is an administration that will live in infamy.

        • such a shame too. Too bad the SBOA can’t do something to prosecute the poor accounting practices of the city. Maybe the state legislature should revise the law to give someone the ability to go after these fiscal criminals.

        • The State will not step in because Pence can’t have that sort of thing going on during his Presidential campaign.
          The Feds are our only chance and it is a slim one, as most of the local agents and Marshalls are friends and/or family of the criminals.

    9. Piss poor accounting, and THREE PAID accountants, beside whatever the SBOA waddled out with. No one’s friend was ALL ABOUT burning Brinkerhoff-Riley at the stake for disclosing this, Chickenshit and Pandering printed what they were told to-and she tried to tell us all a LONG TIME AGO.

      Watch-this is going to get sicker and sicker as the ship goes down. Pity Evansville, we’re stuck with it.

    10. Good Grief Charlie Brown! How can this be? Scoundrels?–In Evansville’s Leadership?
      Lies? Deceit?—-That’s our Elitist Politicos–IN YOUR FACE!
      They have no shame, they have no sense of Morality.
      We can only conclude:– Evansville is absolutely Screwed!
      –And with little left to “loot’ from the Public Treasury,–Broke!

    11. To the Editor: You say ” TO GET THE REAL JEST OF MR. FRIENDS BUDGET CONCERNS.” Do you mean that it’s a joke? Perhaps you meant “the real gist of..”

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