6/16/11

Taveras Tilting at Windmills

It’s come down to brinksmanship now in the city of Providence. Faced with having to find $100 million in cuts by July 1, which is the equivalent of pulling a white rabbit out of a hat, Mayor Angel Taveras is seeking deep cuts in the budgets of the police and fire departments. Going up against these scared cows in the city’s personnel pecking order is brave stuff indeed, and to their credit to date the police and fire unions don’t seem to be blaming him personally, as everyone understands that these are not normal times in the capital city. Taveras is seeking a total of $12 million in cuts from the two departments.

It’s unfortunate that 170 junior officers and fire fighters may lose their jobs. These men and women are in the earliest years of their career, with families to care for. They have financial obligations, to be sure. The unions are seeking alternatives to layoffs in the form of voluntary early retirements and/or wage and benefit reductions. They are also moving to get a restraining order to block the layoffs if negotiations break down, which could defeat Taveras’ objective of reducing the city’s deficit anytime soon. As of this writing, negotiations are continuing as police and firefighter layoff notifications are going out. The mayor also needs to negotiate painful concessions from the teachers union.

Taveras’ attempts to close the $110 million budget deficit depend on coming up with a virtual Royal Flush poker hand, as he needs almost $62 million total in union concessions, increased voluntary payments by non-profits (up to 25 percent of their assessed property value), and General Assembly approvals to get out from under a host of obligations. In addition to police and fire department reductions he needs to gain $18 million in concessions from the city’s teachers union to secure a total of $30 million in personnel cost reductions; win General Assembly approval on switching eligible city retirees from city-paid healthcare to Medicare ($11.8 million), and gain new state and federal revenue ($7 million).

In addition, property owners in Providence, who already pay some of the highest property tax rates in the state, will be on the hook for yet another hike in the property tax (totaling $15.2 million) even as their homes continue to decline in value. And the city has closed four schools (saving $12 million) and reduced its teacher force after the mass terminations issued earlier this year by hiring back all but 119 of 1,445 teachers while furloughing another 370 teachers who are now applying for vacant and temporary positions. And the city will be charging for overnight parking on city streets as opposed to ticketing and its meter maids will be bird-dogging every parking meter in the city day and now night.

State and federal revenue gain is one of the more unlikely items in the mayor’s wish list, as both the state and federal government are essentially broke too. After all, the state is already bailing out Central Falls.

Providence’s financial situation remains very much up in the air as the days count down in June. Moody’s has already downgraded the city’s bond rating in light of its uncertain financial outlook. One has to give Taveras credit for standing up with honesty and fortitude to the crisis his predecessor left behind, especially in a situation where, as a politician, he can’t make anyone happy. But that’s what the situation requires. Thus far, call it a true profile in courage.