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| "Who, me?" Phil Lauer looks into the camera |
Here's what the Home Rule Charter, Northampton County's Constitution, says:
- Section 703(b): Balanced Budget. The total of proposed expenditures shall not exceed the total of anticipated funds available.
- Section 707: "No revenues from the sale of bonds or other forms of indebtedness shall be appropriated to finance annual operating programs or services, except emergency notes and bank borrowings in accordance with § 1.7-705(b)." [Emphasis added].
- Section 705(b): "Emergency Appropriations. To meet a public emergency affecting life, health, property, or the public peace, the County Council shall have the power by emergency ordinance to make emergency appropriations in accordance with the provisions of § 1.6-603. To the extent that there are no unappropriated revenues available to meet such appropriations, the County Council shall have the power by emergency ordinance to authorize the issuance of emergency notes or bank borrowings, which may be renewed from time to time, but the emergency notes or bank borrowings of any fiscal year shall be paid no later than the last day of the next fiscal year."
A confident Brown stated he is waiting for a legal opinion, which tells me he's getting one that tells him what he wants to hear as opposed to what the law says.
Though Glenn Geissinger has been reduced to a cheerleader who endorses whatever Brown wants, conservative Hayden Phillips is another story. "I don't think I can sign on to that. This is Basic Accounting 101."
Council has asked for an opinion from their Solicitor, Phil Lauer. I suspect what he says tonight will determine whether Brown's Budget is dead on arrival.
37 comments:
"Section 707: "No revenues from the sale of bonds or other forms of indebtedness shall be appropriated to finance annual operating programs or services, except emergency notes and bank borrowings in accordance with § 1.7-705(b)." [Emphasis added]."
What more needs to be said?
John Brown inherited a decimated county budget. Mismanaged by Stoffa. The surplus was burned off and bills were left to be paid.
Brown is keeping his promises. Good for him!
Can the taxpayers have any recourse to vote out Brown?
They were told last night that they will have 35 million. Left over from this year. Burned what money?
I could be wrong but my perception is that Brown is banking on the following: 1.)average Joe Schmoe doesn't follow the news--especially County news--enough to get noticeably concerned, but 2.) a tax hike even the politically non-engaged would notice and might be awakened enough to vote, so 3.) try it (LOC) this year and hope budgets balance balance out thereafter through austerity and be able to campaign three years out about how he "held the line on taxes" which will be the right buzz-line to please the Republican leaning voters who show up in Municipal election years.
Funny, while I disagree with a number of his stances, Phillips was the one Republican I actually voted for to ensure some balance on Council if the Dems held a majority. Now he seems to be the one periodically providing some balance against his own party.
Other County Executives tried to campaign on the fact they didn't raise taxes and had their asses handed to them. Brown is a one termer. The County voters do not like controversy and they do not like slicksters manipulating the law to get their way. Brown will not overcome.
Oh the drama! It's now clear the Mr. Brown does not have the support for LOC. What will now happen is that in December fiscal will discover enough in the reserves to balance the budget. Brown will attribute it to his prudent fiscal management this year and the LOC will be replaced with a combination of fund balance and/or cuts to the $3 million in capital projects spending from the operating budget. Move along.
Incompetence I tell ya, incompetence
It's real easy. Don't approve the line.
That action forces Brown to increase revenue projections. Still, a balanced budget with no tax increase.
Next year: Revenues don't come in as projected. Brown goes to council and requests emergency borrowing. Council balks. Brown then furloughs half of the county work force. Easton does not get projected commuter tax. The perfect lose lose lose scenario.
It appears that Brown and his finance bean counters are eager to enter into what very well may be an illegal enterprise, knowing it is illegal, and hoping everything pans out.
Chairman Ferraro stated last night, "we can hope that everything goes at it has in the past several years, but we need to consider what happens if it doesn't."
Raising taxes may reflect more wisdom and prudence than putting NorCo in legal jeopardy.
"Brown is keeping his promises. Good for him!"
Did he promise slash and burn? Did he tell his rural Slate Belt base he would gut Open Space, but still collect the tax dollars for it?
Citizens have had enough of conservatives like Brown and Corbett, who cut cut cut to avoid raising taxes. Corbett and a few other Republican governors will likely be voted out this year, in part by members of their own party sick and tired of lost services, decrepit infrastructure, lower quality of life. Brown is cuing up to go in the same direction.
I respect Phillips for questioning the illegal practice of balancing the budget with a LOC. Someone brought up using unspent bond money to help balance the budget. Apparently the state may be paying for the bridge repairs earmarked by the county's bridge bonds. Someone mentioned that if unspent, this money would revert to the general fund as it has in the past. But this is misleading. In the past, unspent bond money on one capital project was used to help fund another capital project. This was with council's approval. It was NOT used for operational expenses which was implied last night. That would be in violation of the HRC.
"Brown is keeping his promises. Good for him!"
Yesterday I learned that yet another deputy row officer is leaving, one of the top county workers. His policies are causing the County to lose its best people.
"In the past, unspent bond money on one capital project was used to help fund another capital project. This was with council's approval. It was NOT used for operational expenses which was implied last night. That would be in violation of the HRC."
No, it is actually in violation of the IRS rules and the Debt Act. You can't used bind money dedicated to one project to fund another without first adopting an ordinance that declares the first project "impracticable" and unfeasible.
"It's real easy. Don't approve the line.
That action forces Brown to increase revenue projections. Still, a balanced budget with no tax increase.
Next year: Revenues don't come in as projected. Brown goes to council and requests emergency borrowing. Council balks. Brown then furloughs half of the county work force. Easton does not get projected commuter tax. The perfect lose lose lose scenario. "
I see. Because Council won't approve an illegal budget, Brown will dishonestly increase revenue projections, then dishonestly come in for an "emergency" borrowing that council rejects.
If he engaged in this kind of irresponsible and illegal behavior, I expect he would be indicted. Your adivce is horrible, probably like you.
Emergency funds as defined in the HR Charter allows for monies to be borrowed for the purpose of public health necessity.
Therefore the $9 million per year Gracedale hemmorage would qualify for emergency spending. Or Brown could cancel their medical plans and send them to the marketplace for Obamacare.
Problem solved.
If you only knew why the 20 million line of credit is being put into the budget. I know, but you dont.
In fact, I know lots of things you dont.
By the end of the day, Vic Scomillio's hourly rate will be about .50 cents per hour.
"Phillips was the one Republican I actually voted for to ensure some balance on Council if the Dems held a majority"
That is my mistake. He is a much better choice than Geissinger, the R I supported. Geissinger has turned out to be nothing more than a brown cheerleader with no voice of his own, even when Brown is clearly wrong. What a disappointment.
Lauer is wasting his time.
The law:
"any taxpayer of the local government unit or other interested party may file with the department a
petition for a declaratory order asserting the validity or a complaint asserting the invalidity of the proceedings or any part thereof."
Regardless of any local opinion, the aces are held by DCED and any person can challenge the loan or line or whatever as not being consistent with state law. State law trumps home rule on debt matters. Home rule municipalities can adopt legislation governing debt as long as such legislation mirrors state law. The provisions of the home rule charter may not have any standing.
If you only knew why the 20 million line of credit is being put into the budget. I know, but you don't.
My guess is that Brown is waiting until December to get the real fund balance and will use it to balance the budget (rather than the LOC) as has been done in previous years. If Council deletes the LOC and Brown doesn't replace it with fund balance, Council has to come up with some combination of cuts and tax increases totaling $20.1 million to balance the budget. Good luck with that.
As someone who won a bond case before the DCED (one of only two at that time), I can assure everyone that the above commenter has no idea what she is talking about. The issuance of a general obligation note and the budget approval are two distinct matters. The Debt Act does allow a muncicipality to issue a tax anticipation note, but the Home Rule Charter may impose more restrictive limintations than the Debt Act, and the Debt Act specifically states that is the law in Section 8008(b). The Home Rule Charter may also impose additional procedures. A tax anticipation (it is not really a tax anticipation because nobody really anticipates the taxes are coming) or a general obligation (this is what it is) note is permitted under the Debt Act, but in a Home Rule County, the people have the authority to impose restrictions that do not govern elsewehere andf also have the right to establish the procedure to be followed.
Your argument is just a red herring.
Council is attempting to force budget cuts and a tax increase when neither may be necessary. Brown is attempting balance concern for taxpayers and county employees, while council just wants to be contrary. That's been Lamont's MO since he slithered into chambers. Phillips should put taxpayers and workers ahead of Lamont's games.
"If you only knew why the 20 million line of credit is being put into the budget. I know, but you don't."
Thius is interesting. In a transparent government, we alkl should know. We've all been told it is needed to balance the budget bc Brown might run out of money next year.
"Brown is attempting balance concern for taxpayers and county employees, while council just wants to be contrary"
Brown has cut health n=benefots and is opposed to wage hikes. His policies mean aty least one employee will die next year. I don't call that a balancing act.
"Council has to come up with some combination of cuts and tax increases totaling $20.1 million to balance the budget. Good luck with that"
- a 2 mill tax hike - $15 million.
- reduce pension payment via actuary determination so that bond rating is unaffected - $2-3 million.
- raid the $3 million slush fund for table games.
There's $21 million. Thank you.
I had no idea Brown was a murderer. Why isn't his crime in the papers? You're wackier than that West Easton lunatic and you use more breathless hyperbole than her on a day without meds.
It's very easy for non-property holders to demand property holders be taxed. The government that robs Peter to pay Paul can always count on the support of Paul.
2 mills = 19% tax increase. Nice headline, but no chance of 6 votes. Underfunding the pension plan = fiscally irresponsible long term (see Christie/Corbett). Table games = limited to economic development. Add in the loss of anticipated savings for continuation of the current health plan you support.
the real issue:
Gracedale $7.7 million.
Did anyone complain when Gracedale was operating at a surplus for years and pumped millions of dollars into the general fund??
John Brown is not ready for prime time. It is amateur hour in the county. What an unfortunate joke.
3:27, never called him a murderer but his health plan reductions are going to kill people. That is reality, not hyperbole.
Red Herring says:
Line of credit not recognized by Unit Debt Act. Cannot do something that has no legislative authorization. Possibly violates the constitution. "Any unit of local government, including municipalities and school districts, incurring any indebtedness, shall at or before
the time of so doing adopt a covenant, which shall be binding
upon it so long as any such indebtedness shall remain unpaid, to make payments out of its sinking fund or any other of its
revenues or funds at such time and in such annual amounts
specified in such covenant as shall be sufficient for the
payment of the interest thereon and the principal thereof when due." The proposed budget does not give any clue to how the line will be repaid.
Tax and Revenue Anticipation notes are recognized, but Brown would have to first show the higher revenues in his budget-as he hopes-to be able to borrow the proposed amount. These notes do not require DCED approval and bases for challenge are limited to process.
Emergency appropriation under the charter is less restrictive than the Unit Debt Act which requires authorization by the courts.
You don't need Lauer. State law sinks this whole concept.
Reportedly, Lauer didn't say anything tonight about the line of credit. It isn't like there is a rush or anything.
I spoke with Phil prior to the meeting and he is still researching it.
I would have expected Brown to have the LOC researched before putting it into the budget. How council can agree to the budget without knowing is beyond me. Their next budget meeting is Wednesday, the second of four.
From what I've gathered, the LOC is not long for this world.
"2 mills = 19% tax increase. Nice headline" 4:18
Considering that the inflation rate between 2006 (our last NorCo tax increase) and 2014 is 18%, this sounds like a break even readjustment to me.
As I noted last week, this is the year that Council and Brown could have most easily enacted a responsible tax increase that would be good for close to the next decade. They could have even blamed it on those who came before, fair or not. Instead, if they play the "no tax" games it is going to catch up to them eventually. At that point it will be on each and every one of them when they have to raise taxes, and they can't pretend to play the blame game on the previous Exec/Council majority...what percentage will the headlines be screaming then??
And while my comments last week and here have been aimed at the GOP--as they control Council and Exec--Dem McClure was also pandering in his campaign literature during the primary for Exec by "pledging" no tax increase.
All sides need to show some responsible leadership...
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