As I told John Martin and 14 news, in 2013 we collected 86% of the budget revenues in the General Fund and 88% in 2014 and my projections for 2015 have not changed. Â We will miss the revenues projections in the General Fund by at least by $15 million dollars and it could go up to $17 million if Russ Lloyd doesn’t pull the advancement trick from City Utility funds again.
My meeting with Pete Buttagieg, Mayor of South Bend has indicated their budget calls for an increase in Health Care of 20% and we have only 3.68% projected increase.  It’s NOT unreasonable to believe under the current climate in Health Care that our increase will be 10% or more.  If it is only 8% the quantitative miss in the budget would be $1 million dollars.  If it turns out to 10% would be, of course it will be around $2 million.  WHAT CONCERNS THE HELL OUT OF ME is WE HAVE NO RESERVES TO FALL BACK ON!!!! Sometimes I feel we have been annexed by D.C. in our line of thinking.
I have dissected this budget thoroughly and have notices some reductions.  However, I wonder why has the Police Department 2016 budget increased by 3.12% while the Fire Dept was increased by 1.21%.?  The differential between both Departments approximately equal to $5.9 million dollars which is 75% of the shortfall in the GF (3.12-.1.21 x 31m).  Comprehensively,  the spending plan should have started with a flat line budget and proceeded with definite reductions in non-essential line items.  Since the elimination of permitting IDEM and the EPA, the local EPA Department  budget should be in the balance.  Missy Mosby brought up reduction in the Council’s legal expenditures, maybe we need to review that.  We also need to talk about the elimination or partial reduction of the City Council’s Health Care coverage. If so, I would be willing to support at least a 50% coverage ratio.
Of course, we have a daunting task ahead of us considering that after three years of over spending, our overall cash balances have declined by 30% and after this year, the number will be 45%. Â We must have a combined Civil City cash balance to assure that we can make it to the next property tax installment. Â After this year, we may be $17 million from our projections if we don’t excise some financial control and responsibility. This current rate of decline may prove that we have very dark days ahead of us.
Of course, this kind of reporting is NOT popular. If we don’t face the facts that the Winnecke Administration is grossly over estimating revenue and systematically overlooking oncoming increases in operational costs. Finally, Â just before a past employee left the Controller’s office, he strongly urged that the Administration cut $18 million from the budget over the next 18 months. Â He suggestion was made over 20 months ago and apparently hasn’t been done so far. Â Ironically, the operational deficits have been averaging 675-700k per month.
Sincerely
John Friend, CPA
5th Ward City Council member
