Elorza’s Latest Firefighter Savings Claim Off $11M, Says City Auditor
Thursday, November 24, 2016
Providence's Internal Auditor is again contesting savings purported by Mayor Jorge Elorza (pictured) in the tentative five-year agreement with the city's firefighter union.
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The revelation marks the second major shortfall Clarkin discovered in the administration’s calculations in November, after stating the first purported savings were $7 million off. As GoLocal reported on November 3:
Matt Clarkin, the man who unveiled the City's near financial collapse in 2010, has found major errors in the financial claims made by the Administration of Jorge Elorza regarding the new proposed firefighters' contract.
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Following Clarkin finding a $7 million shortfall in the administration’s first fiscal note in early November, the administration submitted a revised fiscal note to the City Council’s Finance Committee in mid-November.
According to the release from the Providence City Council on Wednesday, in the second fiscal note, the administration alleged the agreement would save taxpayers more than $20 million over a five-year period, while Clarkin’s analysis of the administration’s revised fiscal note reveals a discrepancy of $11 to $13 million.
The auditor outlined his findings in a memorandum to Finance Committee Chairman John Igliozzi on Wednesday. According to the Council statement, "Discrepancies were found in most of the administration’s calculations, ranging from failure to include savings in some instances to widespread inconsistencies in calculation methods that exaggerate the TA’s potential savings. For unknown costs like sick time usage that require a range of possible savings, the administration overestimated even best-case scenarios."
"The administration also failed to include the addition of twelve new battalion chiefs in its first fiscal note; the second fiscal note referenced the battalion chiefs but calculated only their base salaries and excluded fringe benefits and the staffing factor from expenses. When calculating savings, however, the administration included fringe benefits and the staffing factor. “The administration’s haphazard approach to calculating the [agreement's] financial impact resulted in understated costs and bloated projected savings,” said Igliozzi.
One of the administration’s more disingenuous claims is an alleged savings of $9 million from the elimination of the 8% stipend firefighters currently receive as compensation for the schedule shift to three platoons. According to Clarkin, a “contractual fiscal note should be a representation of the financial impact of changes to the current contract made in a tentative agreement. The 8% salary stipend was unilaterally provided by the administration and is not part of the current firefighters’ contract. Therefore, the savings from the discontinuation of the stipend should not be included in the fiscal note.”
SLIDES: Elorza's Staff Exodus
Related Slideshow: Providence Fire Fiscal Note - Nov, 2016
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