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Op-ed column: City must do things differently to climb out of financial hole

Sunday, June 10, 2012
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“Schenectady is at the edge of a financial cliff.” The Alliance Party made that claim throughout last fall’s campaign. Our opponents said everything was fine.

Now the truth about Schenectady’s financial plight can no longer be papered over with deceptions. During the campaign, then Acting Mayor/City Council President Gary McCarthy, a longtime political insider, said our claims were ill-founded.

Mayor McCarthy now says of the “newly discovered” $5 million hole in the city’s finances, “it’s not good, but it’s the reality of it.” (And, of course, this hole doesn’t take into account the roughly $4 million owed to the school district.)

No one could run his household this way, and no one should run a city this way, either. McCarthy knew — or should have known — the city’s plight when he blithely claimed all was well; he is at least now being more honest with Schenectadians (but only after the city’s required financial report was released). Since one cannot deal with problems until one admits one has them, we can, I hope, start down the road to budget transparency and fiscal recovery.

No easy process

It won’t be easy. With property values falling (a house on my street recently sold, after more than three years, for less than half of the original listed sale price), the city is faced with the prospect of successful assessment challenges. And with the resulting lowered assessments, the city will have either to raise taxes (an unacceptable solution for the highest-taxed entity in the Capital Region) or make cuts no one wants. Or we can start doing things differently.

When the mayor and I debated last fall, I said I would take a pay cut; he agreed to take one, too. I think, given the seriousness of the city’s finances, he should — until the financial crisis is resolved — reduce his salary to $60,000. After all, $60,000 was good enough for Mayors Duci, Johnson, Jurczynski, and (in his first term) Stratton.

Besides, the mayor is double-dipping by also drawing a public pension from his former positions. Reducing his combined pay (salary and pension) to $120,000 would still leave him with four times the average Schenectady family income. With this symbolic action, he would give himself the credibility — “street cred” — to go to city workers and renegotiate contractual terms dealing with health costs and pensions and staffing levels.

And he needs to do so because we can no longer afford these “sacred cows.”

Wasting resources

A case in point: I was recently in the medical arts building attached to Ellis Hospital when a woman felt faint. A call was made to 911; help was on the scene within 10 minutes (a great response time).

Five people showed up, though — two from Mohawk Ambulance, three from the fire department. I understand job security, especially for public servants who do important work, as the fire department does (I never laid anyone off in my 24 years of running two colleges); I cannot understand how we can afford to have three firemen — using a $500,000 pumper or a $1 million hook-and-ladder — hand a patient to a team of EMTs to transfer her to an emergency room 200 yards away. Obviously, this practice is a waste of scarce resources.

We need changes to our staffing policies. In the meantime, let’s freeze all hires (permanent and contract), and let’s work with the county to accomplish real consolidation (the ideal would be a single political entity for the second smallest county upstate). Policy changes in staffing won’t put our financial house in order; consolidation won’t solve the problem, either — but both will help.

The only realistic way to solve our fiscal mess is to grow our financial base. Even if we sell all our delinquent properties, as the mayor seeks to do, even if home sales pick up, indications are property values will continue to fall.

New revenue

We need additional revenue. The mayor is looking to the waste treatment plant for revenue (after adding 21 people and future pension obligations to the city’s payroll); I think he should look to water — our greatest natural asset. Let’s figure out a way to sell it (Canajoharie just announced a bottling plant to capture revenue from its aquifer, and we can and should do the same thing).

The sales tax contract with the county is up for renewal. Since the county’s sales tax receipts rose 7.9 percent this past year, much of it generated in the city, the city is entitled to significantly more than the $11 million received for each of the past four years. Of course, any additional sales tax money the city gets comes at the expense of the county. However, an increase in county taxes would be spread over 157,000 people; an increase in city taxes is borne by 66,000.

Use Metroplex. Whenever I talk to area mayors, they marvel at how we were able to create Metroplex (we did so by working across party lines). As we said in the course of the campaign, Metroplex has done much good downtown. It needs, though, to turn its attention to the city’s neighborhoods and take down derelict buildings. Recently, we have had a rash of fires in abandoned buildings. Unless we plan to burn down all abandoned properties, we should use Metroplex’s bonding capacity to demolish them, especially in business corridors.

Speaking of corridors, let’s turn Nott Terrace into a cultural/educational/learning corridor. By bringing the Schenectady Museum to street level, relocating the Dudley Observatory into the Annie Schaffer Senior Center, and tying in the Union Graduate College and Union College, we would have a powerful set of institutions to showcase. (In the process, Metroplex should relocate the body shop on Nott Terrace to provide parking space for the corridor.)

Everyone has role

As we seek to work our way out of the mess our politicians have created, we should all play a role. Use the inmates in the county jail to clean our parks and streets. And start a community effort — not a one-shot political photo opportunity — to get Schenectadians to commit a portion of their week — say 1/168th (or one hour) — to clean, paint, plant, or tutor.

Taken together, small individual efforts can make a huge difference in making the city vibrant again. And the better the community looks and the more vibrant it is, the quicker we can bring our financial house in order and reverse the downward trend in house prices and rise in taxes. So let’s get started!

Roger Hull lives in Schenectady. The Gazette encourages readers to submit material on local issues for the Sunday Opinion section.

 
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comments

June 10, 2012
9:07 a.m.
justapto says...

I am so sorry that you were defeated, UNDERHAND POLITICS BY THE OTHER SIDE), last fall. Please consider getting your team on all ballots where ever possible.
Keep up the good work!

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