This post has been updated to reflect confirmation from the Department of Revenue on the Hotel Tax.
With tension high following last week’s release of the mayor’s budget, on Monday the Springfield City Council staked out its own position on the proposed financial plan and the tactics some councilors feel the mayor used to write it. The Council rejected one revenue measure of the mayor’s and sent another two to committee. Although it is possible that all three could be passed in one form or another before the fiscal year begins, the moves made it all the more likely that the city would enter fiscal 2013 with an unbalanced budget.
As a point of reference Ward 4 Councilor E. Henry Twiggs was absent once more due to continuing health concerns. Therefore each vote described below is based on the twelve remaining councilors.
The budget itself had already inflamed passions in the city as defenders of the three library branches slated for closure voiced their opposition before the meeting. During the week, additional concerns were raised about the effect the lean budget was having on the police and fire departments.
As with any meetings, there was minutiae including the acceptance of grant money for Housing and the dispatch department. Funds were transferred within the Treasurer’s office and the City Clerk’s office for the processing of the City Council’s biomass appeal. Transfers not on the agenda, but approved from the Finance Committee included transfers to settle legal claims, pay for increased trash disposal and other items. All, but one passed unanimously. The odd transfer out passed 10-2. The Council also accepted reports from utilities for repairs.
The Council also approved a Public Works takings for easements around a reconstruction planned for the area around St. Michael’s Cathedral. Acceptances of new streets which make the city responsible for former private ways were also approved. As public ways these streets can receive Chapter 90 funds from the state to improve safety and maintenance of such roads..
Many of the fee increases approved in reports last week were before the Council for final approval on Monday. Only one fee increase, on tag sales, was held up. The others, clerks’ fees, animal fees, building commissioner fees, and charitable solicitation fees were passed unanimously or nearly so. Ward 8 Councilor John Lysak abstained from the Building Commissioner fee increase vote.
City Comptroller Pat Burns presented his report pursuant to Rule 20, invoked by Ward 2 Councilor Mike Fenton last week, about the tag sale increases. Using a guess as to how much raising the cap on tag sales would increase the actual number of tag sales, Burns calculated that the city would in $18,000 more in revenue if the city raised its tag sale cap to eight from two. In light of such a low number, Fenton renewed his motion to cut the increase in the cap, this time such that the cap remained at the current two tag sales.
Ward 6 Councilor Ken Shea, who opposed the increase last week, noted that the number of calls he got about this measure spiked after it received publicity last week. At-large Councilor Bud Williams argued that the Council was obligated to vote on the measure in deference to City Clerk Wayman Lee’s work on the matter (most the fee increases were proposed by Lee’s office). The measure failed, 6-6 on a vote nearly identical to one on Fenton’s motion last week, which called for a cap of three tag sales instead of two. However, Ward 5 Councilor Clodo Concepcion switched his vote to opposing the amendment, while at-large Councilors Thomas Ashe and Jimmy Ferrera swapped positions.
At this point it was obvious that the cap of eight was unacceptable, but there was not enough support to leave the cap at the current level. A motion to committee was made along with a request for a recorded vote, which yielded unanimous support for referral to the General Government Committee.
The acceptance of Massachusetts General Law Chapter 64G Section 3A, better known as the hotel local option tax, would ultimately find its way to committee. Acceptance allows the city to establish a rate up to the statutory limit of six percent, but would not obligate the city to do so. Last year, the Springfield City Council never acted on the mayor’s request to accept the section and raise the city’s local option to six percent from four percent. Together with the state hotel tax of 5.7% and a separate levy for the MassMutual Center of 2.75 (which Chicopee and West Springfield share and Boston, Cambridge and Worcester also have for their conventions), the city already has a hotel tax of 12.45%. Last year, city hoteliers and Pioneer Valley tourism officials denounced the increase and sold Councilors in the Finance committee on opposing the increase.
In light of the painful city budget, the Council might entertain the increase this year, although opposition remains high. Like other budgetary matters however, the Council was particularly irked about the short notice. Others like at-large Councilor Tim Rooke worried about the impact the increase would have on the hospitality industry. At-large Councilor Kateri Walsh, who had prior to Monday’s meeting had stated that her mind had not changed from last year on the issue (she opposed), said the business community had almost no opportunity to put in their say as they did last year.
Chief Administrative and Financial Officer Lee Erdman reminded the council that Beacon Hill has not looked kindly upon helping the city if it will not use the tools it was given before asking for more help. However, if true, state officials’ demand that the city raise a relatively piddling $400,000 before the city can get help to tame a multimillion dollar deficit seems a bit cheesy. In any event, the measure was sent to committee for further review.
The hotel tax, like all of the measures the mayor included in his budget is necessary to keep the budget balanced. Erdman confirmed to WMassP&I that the mayor’s budget assumes a hotel tax hike will take effect on July 1st, the first day of FY 2013. However, the hotel tax, like local option on meals, is collected by the state Department of Revenue and then distributed to the cities and town that have approved it. The DOR requires 30 days notice, pursuant to state law, before it can impose the tax in order to properly notify hoteliers and ensure a smooth change in the rates. Consequently, even if the Council had approved the increased hotel tax rate on Monday or even the day after the mayor released his budget, the city still could not collect the added revenue until October 1st. In other words, the mayor’s released budget assume revenue the city has no chance of collecting. The DOR confirmed through email that the city would have needed to submit its request for higher hotel tax by May 31 to begin collecting it in time for the fiscal year starting July 1st.
The final item before the Council was the trash fee increase. Earlier in the year, the mayor had sent a trio of trash fee ordinances to the Council from which it would select one, but none were acted upon. The ostensible reason was that councilors wanted more involvement in the budget than just the option of slashing it. Rather, as would be a theme throughout the discussion on the trash fee, councilors wanted to be actively involved in the budget process and know and steer where the added revenue would go. On Monday, the mayor sent a new ordinance, which would raise the fee $10 this year and then an additional $5 over the next several years. More technical changes would harmonize the trash fee with other financial bills the city generates.
Rooke asked Erdman what the status of the mayor’s efforts to glean more help from Boston. Erdman noted that the state legislature appears poised to approve at least level funding for local aid this year, with the possibility up to $36,000 in extra aid for Springfield. Erdman admitted that other requests for state aid were not warmly received. Erdman promised a fuller report on the talks with the state at Rooke’s request.
Walsh, referencing Sarno’s much publicized visit with Gov. Deval Patrick’s staff and legislative leaders, took the opportunity to demand that a future expedition included members of the City Council. Councilors and the mayor and his administration, “should be doing more together,” Walsh said.
Councilor Fenton noted discrepancies in the ordinance that could obligate the city to pick up trash from commercial and multiple family properties despite terminating such services this week. For those reasons and others, Fenton announced opposition to the ordinance before the council, if not a trash fee increase of any kind.
Like last week, Councilor Shea offered his concern that the Council was getting bogged down in the politics of the budget and not looking at the city’s need for revenue. He acknowledged his colleagues “sensitivity” to how the trash fee increase and other measures came before the Council. However, he noted that opposing the revenue on principle would not do anything for the city’s bottom line. Notably, Shea, a freshman councilor, had prior experience on the School Committee. There, unlike on the Council, members actually develop themselves a budget for the schools. On the city side, that responsibility exists almost entirely with the mayor, save for the Council’s right to cut.
Ward 3 Melvin Edwards, too, voiced objection. He noted that the ordinance will ratchet up the trash fee by $30, if over time. Edwards pointed out that poor neighborhoods, like those he represents, would suffer the most as trash fee scofflaws would simply resort to illegal dumping in vacant lots. Like Fenton, he did not close the door completely on an increase, but he greatly preferred a separate vote each year of a hike rather than automatic increase.
Ward 7 Councilor Tim Allen said he, too, was open to increases, but wanted to see a hike tied to something else. Specifically, Allen, who represents East Forest Park and which stands to lose its branch library, wanted to see if the fee could be leveraged to reopen libraries. Based on conversations he had with city officials, were the fee to rise by $15, two of the three closed libraries could remain open.
Some councilors moved to send the measure to committee even though others like Fenton insisted that enough hearings had already been held. Fenton’s concerns were premature. The motion to committee failed 5-7. Ashe, Walsh, Williams, Allen and Shea were the only votes for committee referral. The Council then proceeded to vote on 1st step of passage of the ordinance raising the trash fee. Usually such votes are passed on a voice vote as permitted under Council rules and state law. However, a recorded vote was requested and the first step failed 3-9, killing the measure. Only Ashe, Williams and Shea voted to advance the trash fee increase.
Following the close of the meeting, Councilor Edwards elaborated on his position on the trash fee. Edwards said he could vote for an increase, but “I want to know where the money is going.” He noted that service cuts and layoffs were already built into budget assuming the new revenues. Therefore it is nearly impossible to know exactly what services the increases in the trash fee and other revenues are preserving.
Edwards acknowledged his and the rest of the Council’s limited role in budget-making. However, he still feels the Council needs to have more of a voice in how money is spent in the budget. Consequently, Edwards like his colleagues are reluctant to rubber stamp the mayor’s budget whatever the separation of powers. “We don’t get to be part of the conversation,” he said.
In some ways the tension between the Council and the mayor over the mayor has ratcheted up more and more each year since ward representation scrambled the old order. In 2010, the Council more or less acquiesced to the mayor. The following year the Council acted to enact some of the most aggressive cuts in years. This year, with the Council steaming over its perception of another year of insufficient financial involvement, it may get uglier.
One factor remains in the mayor’s favor, besides the state Municipal Finance Act that gives him most of his powers. The Council only has itself and its small, largely clerical staff to delve into the budget (or really any matter). Any other staff works for the mayor before the Council. That ignorance puts the Council at a distinct disadvantage, especially where cuts to the budget are concerned.