PAINFUL PLAN: CITIES CRY FOR FUNDING
The national financial crisis has forced many city governments into drastic rebalancing of fiscal budgets. Yesterday morning, a report called “Layoffs, Furloughs and Union Concessions: The Prolonged and Painful Process of Balancing City Budgets,” discovered that union leadership has forced city governments to choose between job losses or reduction of compensation.
According to the Detroit Free Press, “Detroit, Philadelphia, Boston, New York, Chicago, Pittsburgh, Atlanta, Baltimore, Columbus, Ohio; Los Angeles, Phoenix and Seattle were included in the report.”
In Pennsylvania, the Senate approved Philadelphia’s $700 million relief package. But the budget crisis is not over according to Senate President Joe Scarnati. Metro reported that the budget will not be complete for another week.
This financial predicament creates numerous issues within the city. In late August, Nutter announced that there will be a necessary revised budget that will result in the largest lay off of Philadelphia public servants ever.
Fortunately for many Philadelphia city workers, the crisis was averted and these layoffs did not happen.
In comparison, Pittsburgh predicts a major financial deficit in its city budget by the year 2013. According to Pittsburgh’s City Council 2009 Operations and Capital Budget, various initiates will be eliminated. Pay as you Go will end 2011, Reserve plans will diminish and deficit spending will return by 2013. Additionally, Police department pension funds will be exhausted by 2011 and Fire department pension will deplete by 2014.
Even Pittsburgh school districts are waiting for a consultant to value the Rivers Casino—which is set to generate revenue through property tax. The casino has been opened about two months ago and no progression has been made of assessing its value.
Across in Ohio, Governor Ted Strickland anticipated a $3.2 billion revenue deficit within the next two years. Even with the $2 billion cut since January 2008, there will be a 50 percent reduction of state funding to libraries. Hospitals in the state warn the governor of the potential loss of 400 jobs cuts.
The national recession has tempted Strickland to legalize gambling which will give $765 million to the state through racetracks and video lottery terminals. This decision is unlikely, because of voters reject.
Detroit Mayor, Dave Bing, will reduce the jobs for 1,000 people “unless unions agree to take a pay cut.” The Detroit Free Press also reported that “Detroit is facing a $300-million accumulated budget deficit and up to an $80-million cash shortfall this year.”
Even nonprofits are struggling to stay afloat this economic storm. According to The North Carolina Center for Nonprofits report, “400,000 jobs in the state depend on community support.” Additionally, “10 percent of nonprofits won’t make it to the other side of the recession.” The nonprofits in the state of North Carolina earn “$29 billion a year for the state’s economy.” Imagine the numerous local organizations in the community.
Major cities are in serious search for financial reform in their city budgets. Many are receiving relief as others scramble for funds through gambling and casino revenue. Either way, much needed public programs are being cut and reduction in public safety is being slashed. Can these major cities afford these drastic losses? Definitely not, but it is a common crisis nation wide.
Trenae McDuffie
