Sarno appeals to governor for help

Date: 4/11/2012

April 11, 2012

By G. Michael Dobbs

news@thereminder.com

SPRINGFIELD — Without additional state aid, Mayor Domenic Sarno is predicting the city of Springfield will be facing hard times.

In a letter dated March 30, Sarno appealed to Gov. Deval Patrick to act on a list of steps that could insure the city's ability to have an adequate and balanced budget.

"Based on initial assumptions in the [city's] Multi-Year Financial Plan (MYFP), drastic reductions to all city services that would impact public health and safety would be required to live within the projected revenues," Sarno wrote Patrick.

He said that two "revenue components" are preventing the city from reaching its goals. One is the city is "constrained by the Proposition 2 1/2 levy ceiling," which means "that we lose the annual 2 1/2 percent increase (worth $4.3 million fiscal year 2012) and new growth averaged at $4.3 million for the past five years."

Sarno said the city's Unrestricted General Government Aid (UGGA) has decreased 32 percent — $15 million — since fiscal year 2008. Sarno added, "All of the city's state aid support the School Department and none is left over for municipal operations."

According to the MYFP, prepared by Chief Administrative and Financial Officer Lee Erdmann that accompanied the letter, state aid has been decreasing at the same time non-discretionary spending such as health insurance, debt service and an unfunded pension liability "are the drivers of the increase on the spending side."

Of the entire city budget only about 20 percent is discretionary, which means, "the discretionary portion of the budget must assume all of the reductions to achieve a balanced budget," according to the report.

The report concluded, "Based on these assumptions, it is clear that spending growth will continue to outpace revenue growth for the coming years forcing the city to develop creative solutions, reduce or eliminate programs and services and ask the state for additional assistance to meet core service needs that the city provides to residents, businesses and visitors."

To address these concerns, Sarno suggested a lengthy list of actions he hopes the state government would put into place.

Among the suggestions, he asked for Home Rule legislation that would allow the primary levy limit to go beyond 2 1/2 percent.

Sarno would like to UGGA to the city increase by $3 million over the next five years and has asked the state to pay for part of the cost of school transportation as well as reimbursement of money spent on transporting homeless students. The city is spending $20 million in bus costs annually and has spent about $700,000 in the transportation of homeless students.

He called for a revised formula on state aid allotment and cited a study by the Federal Reserve Bank of Boston that noted Springfield "is not receiving its fair share of local aid based on the current formulas for Chapter 70 [school funding] and UGGA."

The Oct. 29 2011 snowstorm cost the city $30 million and Sarno wrote, "The state has been silent on its participation in reimbursement."

Sarno concluded that he realizes his list of suggestions is "long and expensive," especially at a time when the state government is concerned about its own financial situation.

When asked for comment, City Councilor Timothy Rooke, long known for his interest in the city's finances, said he was unaware that Sarno had sent this letter to the governor.