Riley: Mayor Elorza Lacks Progress
Tuesday, May 30, 2017
“If Providence did nothing about its fiscal challenges today, it would face a $37 million budget gap by 2026, and expenditures would outpace revenues by $176 million over the next 10 years. While the city does not face the prospect of bankruptcy anytime soon, failure to act now would be a prescription for insolvency.”
Forming or funding studies and local workgroups is not the same as engaging in the real reform and change that both these reports describe. Mayor Elorza seemed on board with PFM initiatives and seemed to understand the implications of not doing anything.
Any “Progress” from our Progressive Mayor?
The PFM report and the NRN report both emphasized the need to act quickly and dramatically. Despite Elora's public proclamations, little progress has been made. Additionally, many of the assumptions like zero wage increases over 5 years appear to be as misleading as his pension accounting. Neither report accounts for what happens to deficits if pension returns are 5% or lower instead of 8%. Also, there is no accounting for the possibility of a recession in either report.
The biggest issues are the pension/OPEB debts and costs of benefits. Both reports describe the need for a grand bargain between Elorza and the Unions. Since the State taxpayer is on the hook when Providence inevitably fails my guess is the Governor and State Officials are watching very closely for any progress from Elorza in addressing Providence Finances. What we have instead seen is a distracted Mayor wanting to engage in political barbs with a nutty President. A Mayor who would rather address protecting illegal immigrants than protect his own taxpayers and his cities overall well-being.
Related Slideshow: 10 Things to Know about Elorza’s Fiscal Year 2017 Budget Proposal
Providence Mayor Jorge Elorza introduced his Fiscal Year 2017 budget proposal for the city -- here are 10 things you should know.
Car Tax Exemption
Elorza's FY17 budget raises the car tax exemption from $1000 to $2000.
The exemption had once been as high as $6,000 in the City of Providence, which has the highest car tax rate in the state.
Elorza had pledged during his campaign to raise the examption up from $1000 -- which will have budgetary implications, but had been an issue of importance to Elorza due to its impace on lower-income residents.
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