Yer Kiddin'

The Peekskill Republican campaign crew has been putting out some highly creative assertions about our city’s financial health.  They can put all the big red arrows they want on their charts, but that proves nothing except that their graphic artist is smarter than their accountant.  And that the Peekskill Republicans still care much more about style than about substance.

A few actual facts:

The total government fund balance on December 31st, 2012 was $27 million with a general fund savings balance of $7.2 million (pages 17 and 18 of the audited financial statements).  The general fund savings balance was $13.1 million on 31 December 2007 (page 18 of the 2007 audited financial statements).  The General Fund decreased $1.520 million in 2012 (page 68 of the audited financial statements) which was a little better than the budgeted decrease of $1.551 million. The cumulative decrease over 5 years was $5.9 million.

So, what affected the general fund savings balance from 2008 through 2012? Pension bills came to $4.1 million.  The decrease in mortgage tax revenues was $1.8 million.  Legal bills in the Deskovic case came to $500,000. Not exactly top secret stuff.  But that was then, and this is now.

·               The general fund savings balance is expected to increase $1 million in 2013.

·               Mortgage tax revenues have started to rebound with the economic recovery and resulting increases in home sales. 

·               Other revenues have also been slowly increasing and we have been cutting spending to close the gap.

·               Pension bills are leveling off

·               The Deskovic case has been settled. 

Then there’s the Moody’s credit rating. 

Despite some people’s hopes for a financial collapse, the City’s bond rating has gone up since 2007.  Frank’s “forensic accountant,” if he has one, apparently doesn’t understand how Moody’s rating system is structured.  The highest rating category is AAA. The second highest category is AA and then there is single A, then BAA, BA etc. The numbers work in the reverse order so AA1 is better than AA2 which is better than AA3; A1 is better than A2 etc.

Here is the history, right from the bond offering documents:

On Sept. 21, 2007 Peekskill issued bonds which were rated A2.  Moody's then reviewed the City's 2007 financials and revised the bond rating up to A1. This event was noted in the 2007 audited financial statements.  On August 10, 2010 the City issued bonds and the bond rating was revised up again to AA2, which is a jump of two rating categories.  The rating on the bonds issued on Dec. 2, 2011 was still AA.  In May 2013 the rating was adjusted to AA3, which is still better than the A1 rating in 2007, when last the Republicans, led by then-Mayor John Testa, were in charge.

Lastly, the Republicans’ claim that the city spent $4 million on consultants, legal counsel, and studies is fantasy. The only way they could get to that number would be to include the $2.8 million in tax certiorari refunds the city paid from 2008 through 2012; the legal fees for the Deskovic case, which was an inherited problem; trip-and- fall and property legal settlements of approx. $400,000 over 5 years; workers compensation claims adjusters and investigators; and appraisal services on sales of property. 

All consulting contracts are passed by resolution.  Our city has been very selective in doing "studies" that are not paid for with grant funds. Individually each contract was less than $100,000. They are:

·          Charette consultants to solicit and respond to public input doe the industrial district, Peekskill Landing, the Lincoln Depot Plaza and Visitor Center

·          Retail attraction and retention plan

·          Rezoning study for the Westside

·          Developing an economic strategic plan for tourism

Maybe it’s not fair to compare Mayor Mary Foster, a certified public accountant with over 30 years of experience at a major audit and accounting firm and Frank Catalina, a self-described “country lawyer”.  But really, who do you want working on our city budget?