CITY COUNCIL DIGEST

Budget review proceeds amid uncertainty

As uncertainty looms over RI’s financial picture, city’s budget review proceeds

By DANIEL A. KITTREDGE
Posted 5/20/20

By DANIEL KITTREDGE The city is moving toward adoption of a budget for the coming fiscal year, but a number of significant questions remain as the pandemic continues to upend planning and typical processes at all levels of government. The City Council's

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CITY COUNCIL DIGEST

Budget review proceeds amid uncertainty

As uncertainty looms over RI’s financial picture, city’s budget review proceeds

Posted

The city is moving toward adoption of a budget for the coming fiscal year, but a number of significant questions remain as the pandemic continues to upend planning and typical processes at all levels of government.

The City Council’s Finance Committee has been holding its annual hearings on Mayor Allan Fung’s $302.9 million budget plan since May 9, including multi-hour virtual sessions on Friday and Saturday of last week.

On May 12, it reviewed the mayor’s $168 million budget proposal for Cranston Public Schools – one that includes a projected increase of more than $4 million in state education aid, based on the state spending plan Gov. Gina Raimondo submitted to the General Assembly prior to the onset of the COVID-19 crisis.

During the hearings – all of which have been held virtually – questions have arisen regarding the timing of the process and the number of variables that remain. Indeed, Fung’s budget address, originally scheduled for April 1, was delayed several weeks and delivered remotely due to the constraints of the current situation.

At one point last week, Council President Michael Farina was poised to call a special budget adoption meeting for May 14 out of concern that the terms of the city’s charter – which call for the budget to be adopted no later than May 15 – would result in the mayor’s plan automatically taking effect the next day, well ahead of the scheduled May 22 meeting for budget amendments and adoption.

“The underlying fear is that the charter trumps our meeting schedule,” Farina said during the Finance Committee’s May 12 hearing.

Council members that night formed a consensus around proceeding with the planned hearing schedule and canceling the special meeting. In the interim, it appears the concerns over a conflict with the charter have been allayed, and Farina on Monday said based on discussions during the Finance Committee’s Saturday hearing, the budget adoption would be moved to May 27.

“It should give us some more time for review and more information gathering … Due to the delay in the council receiving the budget we can delay our adoption due to the emergency,” he wrote in an email.

Fung on Tuesday said he has no issue with the council taking more time for its budget review, although the need to print and distribute tax bills creates some urgency. He said the May 27 date provides enough time for that process, but going further out would create problems.

“I certainly am not going to quibble about a technical date in the charter, and I’m willing to work with the council to give them a little bit more time … The big key is, we need to get the budget done so that we can get our tax bills out,” he said.

The Finance Committee was set to conclude its hearings schedule with a focus on proposed amendments to the mayor’s plan on Wednesday night, after this week’s Herald went to the press.

A major issue moving forward figures to be the school district’s budget, given the uncertainty surrounding the state’s financial picture and the amount of aid dollars that are in flux.

The initial school budget plan submitted by Schools Superintendent Jeannine Nota-Masse earlier this year totals $169.2 million and seeks an additional $1.76 million in funding from the city. In includes a more than $4 million increase in state aid as well, based on the governor’s budget.

Fung’s plan would provide an additional $400,000 in local funding for the district, and it, too, includes the additional state aid. That leaves a roughly $1.2 million gap between what the district and mayor have proposed.

During the May 12 budget hearing, Nota-Masse spoke about the uncertainty surrounding state aid.

“We do not know the assumptions we are making in this budget will come to fruition … We don’t know what’s coming from the state,” she said.

Addressing the issue of where the district would look to reduce expenses if anticipated funding does not materialize, she said: “I can’t answer those questions … I’m 100 percent confident that we have a solid budget, and it was designed very frugally. However, in this pandemic that we’re in, I am worried about the state monies.”

She added: “It would be irresponsible for me to come out into a public meeting and start spit balling, if you will, about what I think will happen.”

Farina, during the meeting, raised another concern – that the city, if it were to approve a budget that relies on the full state aid projection, would become responsible for making up any shortfall if the aid fails to materialize due to “maintenance of effort” school funding requirements for municipalities.

On Monday, Farina said the council is “still waiting for clarity” regarding the maintenance of effort question. The council’s auditor has been in communication with district officials he said.

“I am hopeful we have a definitive answer this week,” he said.

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