Current Report: Northampton County
3/18/2003
As you are all aware, we are in economic crisis. The federal deficit grows larger, and the State is reducing its contributions to counties. Last year, Northampton County was forced to adopt a 19 percent tax increase, and the County is facing 25 percent tax increases in each of the next two years according to its own Fiscal Affairs department.
These increases do not reflect the additional money the County must find to satisfy the need for prison expansion, a new domestic relations facility, undefined open space projects, the Hotel Easton parking garage, and an expanded parking facility at the county campus. Although the administration cannot be held responsible for this uncertain economy, it is certainly guilty of very poor planning and has already wasted millions on abandoned prison studies.
A telling example of the administration's fiscal irresponsibility is found in the $3 million Gracedale project, which was never opposed in the bond litigation. During budget hearings late last year, it was discovered that project still had not been funded. Had those projects been funded, the County would have received almost complete reimbursement from the State and would have $3 million in found money, which would certainly ease the tax burden.
But that project was still not funded a few weeks ago, when an elderly resident lost her life as the result of a tragic fire. The administration's explanation to The Express-Times Editorial Board: The funding delay at Gracedale is the result of "lengthy discussions" with County Council (Express-Times, 3/6/03). The simple truth, as you know, is that Council has imposed no obstacles to any of the bond projects and has been reluctant to intervene for reasons that still elude me. There certainly have been no discussions at all concerning the Gracedale project. Nevertheless, you find yourselves accused of negligent homicide by an administration that has had the money and a good incentive to complete the Gracedale project, but chooses instead to do nothing but point its finger.
Fresh on the heels of publicly blaming you for contributing to the death of a 104-year-old woman, the administration proposes deep cuts to pay for its $8 million debt service on the 2001 bond, a bond that was supposed to pay for itself. A 20 percent cut in core services is proposed. Council has not been advised by the administration of its intentions, but this information was gleaned at a recent Finance Committee meeting. Rather than eliminating a $1 million parking lot for 200 luxury apartments, the administration proposes instead to cut the Weaversville park project, flying in the face of the open space sentiment expressed in the elections last fall.
Interestingly, the luxury apartment complex (which also includes a health club and spa) is supported by Reibman one month after the developers contributed $1,825 to his campaign coffers (Morning Call, 2/6/03). In addition to supporting the development of a spa and luxury apartments, Reibman has given the green light to an industrial development project for $2.2 million in available bond proceeds to another contributor who a month earlier picked up the $2,000 tab for a little Christmas party thrown by Reibman's campaign (Morning Call, 2/20/03). Unlike these projects, the Weaversville Park project had only the support of common voters. Dollars apparently count more than voters. While telling you out of one side of its mouth that you cannot find the luxury apartment project to be "impracticable" or "unfeasible," the administration tells you out of the other side of its mouth that you can make such a finding with respect to a clearly defined open space project.
The administration told the Express-Times, not Council, that it is now paying an analyst to compute the cost savings of retiring some of the debt but still won't specify what areas of the bond are under consideration (Express-Times, 3/14/03). If its recent track record is any indication, the administration will attempt to curry favor with developers who make campaign contributions at the expense of open space as well as the core projects that make the County run, like Gracedale.
The administration has demonstrated a clear disregard for its core functions, as evidenced by the lack of funding at Gracedale and a willingness to lay off career service employees who can least afford it, to say nothing of the services provided by the District Attorney, the Courts, and the Controller. Is this the "bold" and "innovative" idea that Reibman had in mind when he (with Michael Solomon's help) first proposed the megabond? Was he really trying to produce more jobs or was he securing a steady flow of campaign contributions? Whatever his intentions, the bond was so poorly planned that the administration did not even have the zoning it needed for its prison project. And after years of denying that it needed to do anything about parking, it only admitted last Friday that there is going to be a significant parking problem that can be solved only with additional money that we don't have (Morning Call, 3/14/03).
The debt service will be paid by reducing the core services offered by the County. Career service employees will see their health care benefits and security destroyed, the two main reasons for working in the public sector. And before long, the diminishment in core services offered by the County will be experienced by all taxpayers. What happened at Gracedale should be a wake up call to all of us instead of an occasion for the blame game.
Despite all its games about your inability to declare a project unfeasible, the administration conceded it is very easy when it suggested that you might kill the Weaversville Park project. Rather than listening to someone who talks with smoke and mirrors, all you need do is examine the language in the much challenged bond ordinance. It quite clearly gives you sole discretion to decide whether a project is no longer feasible. You have the right to declare any or all of the projects unfeasible should you choose to do so. The change in the economy and the poor planning by the administration should give you ample incentive to whittle away at what is not necessary.
There are nearly $30 million in unspent bond proceeds for economic development initiatives alone. Councilman Grube stated publicly several months ago that if he did not see results by March, he would be inclined to agree that it is a mistake to continue funding these projects. The only changes that have occurred in that time is an administration attempt to burden the nonunion county workers with the cost of the bond, which will result in a further diminution of core services provided to taxpayers. I suggest that you start right there and declare all economic development projects unfeasible. As noted in the Wall Street Journal, "The handout game, whether it involves steel mills or baseball teams or high-tech R&D, stops when politicians fathom or are made to learn that it doesn't pay off in most cases... They ought to attend to competitiveness by maximizing the appeal of their jurisdiction to every kind of enterprise, not just those with a big snout." (2/3/94).
I suggest that you direct your solicitor to draft an ordinance revoking all unfunded economic development projects in their entirety. I further suggest that you look at reducing the cost of the courthouse expansion as well as all the other projects (excepting Gracedale and a relocated prison) by 20 percent. It may be that there is no room to cut in those projects, but it is far better to reduce an expansion than to reduce a workforce. The savings realized by these cuts would amount to $46 million. Of that sum, $13 million will have to be diverted to the prison, domestic relations, and parking expansion. That will leave a net debt reduction of $33 million, which will eliminate at least $2 million in debt service every year. Completion of the Gracedale project will result in a nearly $3 million reimbursement from the state. Elimination of the Northampton County DCED will also result in $0.5 million savings annually.
It is possible to reduce or eliminate the
next tax increase through frugal and responsible planning. Unfortunately, there
is a communication problem not only between the administration and Council,
but even among the members of Council. Individually, you are all excellent and
reasonable people of good will who want what is best for the County. But collectively,
you have been unable to accomplish much of anything and do not seem to be able
to communicate with each other. Now is the time to act together, conduct caucuses
as necessary (without violating the Sunshine Law), and take some bold actions
of your own. This will only benefit the county employees, the residents of Gracedale,
the prison population, and the taxpayer. I believe you are in a crisis and you
have the means to solve it or permit the situation to get worse. Please, do
the right thing.
Bernie O'Hare