"It must be remembered that there is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage, than the creation of a new system. For the initiator has the enmity of all who would profit by the preservation of the old institutions and merely lukewarm defenders in those who would gain by the new ones." Machiavelli
BailoutsBy DIA, Section News
What better day to talk about the economic reality of Albany than on a day we wake to find more news of how we the tax payers are bailing out the elites. Hope you like bailouts because you will be bailing out Jerry Jennings and his cronies in the near future. They have pushed the city deep into the red and you will be getting the bill for their party.
Recently we were told that one of Joe Bruno's last acts was to take more taxpayer money and bail out his friend Jerry Jennings. This would be done with PILOT payments for the Harriman Campus. A bill that would deliver $5.5 million to the city of Albany this year – and $11 million annually in subsequent years – overwhelmingly passed in the state Assembly late on Tuesday night and now awaits Gov. David Paterson’s signature.See how it seems like everything is a-ok if this money gets approved by the governor. According to the TU, the city currently has a budget gap of $7 million and this would give us an extra $11 million a year. Party! However, for those of us who like to plan our lives beyond the next weekend, the picture is a bit less festive. Here is the reality of the city's finances. 1) $7 million is probably a bit of an understatement of the true budget gap. And this doesn't even take into account the looming financial debacle that is the landfill. $7 million is currently best case scenario. 2) So, next year we would get $5.5 million which means we are $1.5 million in the hole even if there are no budget increases. Of course their have to be budget increases even if nothing changes because the city has borrowed more money this year and energy and health care costs have gone way up. Next year is also an election year. Expect some sort of financial smokescreen and no tax increase. This will once again just be delaying future tax increases. Further into the hole we go. 3) The Very REAL Problem in 2011 - Starting in 2010 we would be getting $11 million a year which at our current burn rate would give us a $4 million surplus. However, our existing PILOT payments that we already get also change in 2011. Jennings lobbied state officials to amend the agreement covering payments in lieu of taxes -- PILOTS -- to give the city this year $22.85 million in PILOTS instead $16.85 million. Next year, the city will receive the same $22.85 million instead of $16.1 million that had been scheduled.Currently getting $23 million. In 2011 that drops to $15 million. So that is another $8 million hole in the budget. 2011 budget looks like this: Money we don't have=$15 million $7 million/year (current budget gap) $8 million less PILOT money Money the state may give us with new legislation= $11 million. The absolute best case scenario is we start 2011 $4 million in the hole. I'm guessing the reality would be much more like this year and we'll be back to at least $7 or $8 million. The country is facing a financial crisis. The state is facing a financial crisis. And the city is as well. Is Jerry Jennings the person you want trying to manage this mess when he has dug such a deep hole for the city when things were actually going well economically? After years of ignoring the neighborhoods of Albany, Jennings finally proposed to invest in the neighborhoods via his Block by Block program. However, he didn't say where the money to fund the program was coming from. Anyone got any ideas? You can't fix neighborhoods with press releases alone.
|
All trademarks and copyrights on this page are owned by their respective companies. Comments are owned by the Poster. The Rest © 2005 The Management