Fiscal Frugality? Sometimes for local governments, fiscal independence should be the goal - Granite Grok

Fiscal Frugality? Sometimes for local governments, fiscal independence should be the goal

My time as a Budget Committee member taught me a lot of lessons – one of which is how each level of government depends on money dropped down from above (or taken from below).  Trust me, it is not a small amount of money (and here in NH, it is a Big Boatload at the State level).  For years I told our town “watch out – what cannot be sustained will stop” as I watched the Feds borrow themselves into oblivion (and at the time, the Democrats in Concord doing the same thing).  In the end, The Piper demands to be paid and local governments started to howl when the money rain they had built into their budget dried up and politicians had to start explaining the effects of having depended on “free money” – and now that “free money” is going to cost dearly.  Like now in NY!  From Yahoo (reformatted, emphasis mine):

The New York state budget currently under negotiation may be remembered years from now as the beginning of the end for many small towns, cities and school districts. Gov. Andrew Cuomo had tough words Friday for local officials facing fiscal crises and seeking more help from Albany, telling them they should consolidate services or whole governments and school districts rather than looking for relief from Albany. “If it was really, really tough, you’d see that happen,” Cuomo said in his strongest comments yet on the local fiscal crises. “If you are a school district, or a city, or a town or a county, and you are looking for a fundamental financial reform, consolidation is one of the obvious ones.”

Well, I’ve been putting up a number of posts on Granite State Future – the local incarnation of the Federal mandates by HUD, EPA, and DOT called “Sustainable Communities Initiative” which seeks to Federalize local zoning laws.  In essence, they seek to “urbanize” more rural areas – and to regionalize those areas (as we are seeing here in NH via the “unseen” level of government called the Regional  Planning Commissions).  Gee, is what are we seeing here in NY?  If several smaller communities are being forced to merge because of being too dependent (yeah, coming off that crack high of “Free Money” is a real downer, eh?) on other peoples’ money, hey, can we go all conspiracy here or with Occam’s Razor, better to just go with Governmental Stupidity?

Cuomo said he believes local politics is standing in the way of mergers and consolidations that would save taxpayers money and improve efficiency of services. He said deciding to consolidate should be easy, yet “politically, it’s difficult … I get the politics.” Despite years of hard times, Cuomo said you can count “on one hand” the number of consolidations among 50,000 local governments, school districts, fire and library taxing districts and more. School districts and local governments say they are already consolidating and merging, but that’s not enough. They are asking for more laws than Cuomo has offered in his state budget proposal to cut labor costs, pension costs and more funding.

Of course it is.  After all, all good “common sense” people would be extremely happy to be part of a larger entity than a small, close knit community where everyone knows everyone else, right?  Sure – it can ONLY be politics by the hinterland rubes that are standing in the way of…wait for it….Progress (who knew that bankruptcy was part of Progressivism?)!

 “Talk of consolidation is just an avoidance action by the state so they can avoid the real problem of state mandates,” said Peter Baynes of the New York Conference of Mayors. “If you talk to any local government in New York state, they can rattle off the consolidations they’ve made and they are squeezing all the savings they can out of shared services.”  Baynes said voters only agreed to dissolve three villages out of 20 that held votes within the last five years. But in most cases, the savings — if any — were seen as too low and the diminished services and cost of a lost hometown identity too high, he said.  Local governments and school districts blame programs and costs required by Albany, often won by politically powerful public worker unions, for many of them facing insolvency.

Hmm, the SCI, or is Occam right?  Those unfunded mandates add up after a while – and so do those Public Sector Union contracts.  California is already broke due to those contracts – and more and more of that State’s financial burden is going pay employees elevated rates than actually providing services to taxpayers (just ask Rhode Island, too).

Cuomo has offered a way to cut current pension costs now by borrowing against projected future savings, but a growing number of local leaders consider that risky and unwise. Another would require arbitrators in labor disputes to consider local taxpayers’ ability to pay for a labor resolution, but that faces opposition in the Legislature. Despite layoffs and service cuts, these municipalities and school districts say they face insolvency within five years.  “We know of 20 school districts that are currently considering mergers and are in various stages,” said David Albert of the New York State School Boards Association. But he said most in the past have ended as one did this week near Glens Falls, losing by a 4:1 margin in a vote of the residents.  “The communities don’t want economics to drive every educational decision. They want a quality education for their children,” Albert said. “So we find a lot of mergers fail.

Yeah, that’s right – Failure.  Seems to be a lot of that around lately – especially when one demands payment from the future.  Once that happens, the only conclusion is that our “betters” have already screwed up badly in being real managers.

It won’t just be the mergers that will be failing.

 

The income tax increase is currently due to expire in 2014. Approval now would avoid taking up the dicey issue in an election year for Cuomo and lawmakers.

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