Calculating the Loan Amount
Under normal circumstances, when you borrow money, you know the amount of the loan. You are informed of the interest rate, the terms of payment and what happens if you default.
None of that information was provided to the taxpayers of IRB or to our elected City Commission when the loans from our General Fund to the Sewer/Solid Waste Funds began…way back when. In fact, it took a paid outside governmental accounting consultant (paid for by YOU!) to calculate the amount; no one on our city staff was apparently able to determine the figure.
So how was the debt calculated? Were the prior-year revenues BEFORE the latest $300K downward adjustment relied upon in calculating the need for a 60% rate hike in our sewer and solid waste rates? If so, aren’t we in for yet another surprise? It only stands to reason that if sewer and solid waste revenues were LESS than what the books reflected in the prior year, that shortfall would carry through to this year’s financials, right? Wouldn’t that make the outstanding loan balance due back to those funds higher?
It all depends on when the prior year’s books were adjusted downward to reflect the “actual” sewer and solid waste revenues as opposed to the "projected" amount. In a perfect world, this reduction in revenue would have happened AFTER November 13th, when the commission voted 4-1 to approve amending the budget. By charter, this type of budget adjustment requires commission approval.
We know when the vote was taken to approve amending the budget (Nov. 13); what we don’t know is when the adjustment was actually made on the books.
There are two possible scenarios--neither of which is good:
Under normal circumstances, when you borrow money, you know the amount of the loan. You are informed of the interest rate, the terms of payment and what happens if you default.
None of that information was provided to the taxpayers of IRB or to our elected City Commission when the loans from our General Fund to the Sewer/Solid Waste Funds began…way back when. In fact, it took a paid outside governmental accounting consultant (paid for by YOU!) to calculate the amount; no one on our city staff was apparently able to determine the figure.
So how was the debt calculated? Were the prior-year revenues BEFORE the latest $300K downward adjustment relied upon in calculating the need for a 60% rate hike in our sewer and solid waste rates? If so, aren’t we in for yet another surprise? It only stands to reason that if sewer and solid waste revenues were LESS than what the books reflected in the prior year, that shortfall would carry through to this year’s financials, right? Wouldn’t that make the outstanding loan balance due back to those funds higher?
It all depends on when the prior year’s books were adjusted downward to reflect the “actual” sewer and solid waste revenues as opposed to the "projected" amount. In a perfect world, this reduction in revenue would have happened AFTER November 13th, when the commission voted 4-1 to approve amending the budget. By charter, this type of budget adjustment requires commission approval.
We know when the vote was taken to approve amending the budget (Nov. 13); what we don’t know is when the adjustment was actually made on the books.
There are two possible scenarios--neither of which is good:
1. The prior year’s books were adjusted AFTER the commission voted to approve the adjustment on November 13th, incorrect revenues were used to calculate our sewer and solid waste rates and the 60% increase wasn’t enough; or
2. The correct revenue figures were used when setting our sewer and garbage rates, meaning that the budget revision was made well BEFORE it was ever approved by the commission…and HERE WE GO AGAIN.
Isn’t this how we got into this financial mess to begin with—adjustments and movement of monies between funds without City Commission approval? Why aren’t any of the five people sitting up there screaming about this and insisting that systems be put in place and followed?
Mistakes are a way of life. In fact, they can actually be beneficial if one learns from them. If no learning occurs; however, and the system doesn’t change to keep the same error from happening again and again—isn’t that called stupidity?
Nancy Obarski
Beach Trail/IRB
7 comments:
I petition that Cookie Kennedy get to the bottom of this. She is the only one up there showing any understanding of this complex matter. Besides, she’s the only one in town who was able to put Leo in his place. He hasn’t had a word to say about IRB since Cookie took him out to the wood shed and smacked him around. Cookie, this town needs your help!
And we need a hair cut
I also believe Cookie can get the job done. Her cost cutting efforts on the budget saved this town tens of thousands.
And she can see Russia from her house!
I take it that you're not a fan of Cookie. If not her, then who will fix this? You? Stop being part of the problem. We have enough of those here in town.
First of all, the Palin comparison could be seen as a compliment and it could be a joke, so lighten up.
Can you be specific as to what cost saving efforts saved IRB tens of thousands of dollars? I see these goofballs preventing transperancy and failing to answer questions from the public, so how is CK showing a complex understanding of these matters? I am sure that some of them read this blog, how come none of them ever ask the questions that Nancy has presented? How come none of them are able to answer these questions? While I agree that Cookie has surprised many, giving her credit for Leo not writing about IRB is no reason to nominate her for Mayor in 09. I do not know who can save this town, but I do know that none of the current elected officials have the "Stones" to stir things up and demand answers. Daniel had the opportunity when it came time for the vote on the millage and he caved in to pressures, perhaps from his landlord Cookie. I know that Dumb & Dumber only care about short meetings and moving their own agendas along and need I say anything about Mr. Sea Oats. As for Cookie she is in the best position to make a difference but so far I have not seen anything out of the ordinary from her. If I am missing something than please enlighten me and then perhaps we can consider her a Maverick.
it would not be until 2010 unless we recall Mr. Sea Oats.
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