BOSTON (State House News Service) – North Adams has bottomed out its reserves, raised a range of fees and the mayor of the city in northwestern Massachusetts plans to push for a $1.5 million property tax override next year in a bid to stave off fiscal ruin.
“We’re broke. We’re broke. We’re one cycle short of Detroit,” Mayor Richard Alcombright told state officials Wednesday morning.
Department of Revenue Director of Accounts Gerard Perry advised the mayor to stop comparing his city to Detroit, which filed for bankruptcy last July, and said, “We will not allow it.”
On Wednesday, the Municipal Finance Oversight Board granted North Adams the ability to use the state’s bond rating for $31.4 million in borrowing to finance accessibility improvements required by the Department of Justice, the city’s share of airport improvements, technology investments and a middle school renovation. After Massachusetts School Building Authority reimbursements, the total borrow would be about $8.2 million, Alcombright said.
Alcombright said the city is hoping to replenish its reserves, which stand at roughly “zero” with a $750,000 one-time grant from the Legislature, and said he met with House and Senate budget writers on that issue.
“He’s not the only one. Haverhill gets $2 million a year by the way, without restrictions,” Perry said at the meeting with State Auditor Suzanne Bump and other state officials.
On his way to a conference committee meeting Wednesday, House Ways and Means Chairman Brian Dempsey, a Haverhill Democrat, told the News Service the money for Haverhill is “a different issue” and complicated. A Dempsey aide said the money for Haverhill is related to a city-owned hospital.
Sen. Benjamin Downing, a Pittsfield Democrat who represents the city in the northern Berkshires, sponsored the provision of the Senate budget that would give North Adams a $750,000 grant to make up for revenues lost when the North Adams Regional Medical Center abruptly closed earlier this year.
“It’s like the wind’s popped out of you,” said Alcombright, about the sudden closure of the 129-year-old hospital that employed more than 500 people. The mayor said the reopening of emergency services has brought about 160 people back to work and “settled us down a little bit.”
A former banker who was elected to his father’s City Council seat in 2001 and won the mayoralty in 2009, Alcombright said this year is the first year in his dozen years of elected office that North Adams will have a balanced budget, without the need to draw on reserves and without any reserves to draw from.
“We’ve cut budgets. We’ve raised taxes. We’ve raised fees. We’ve cut budgets. We’ve raised taxes. We’ve raised fees. And this is the first year in my memory that our budget is balanced,” Alcombright said, summing up the recent fiscal picture.
Alcombright said the City Council on Tuesday approved the budget, which relies on a revenue package, raising water and sewer rates, parking fees and increasing the penalty for late payments. He said he plans to start campaigning for an override this September or October, which will give him more time to lay the groundwork than his failed 2011 bid to raise property taxes above the limit imposed by state law.
Alcombright said he started campaigning for an override in May 2011 for a vote the next month. North Adams defeated the 2011 override attempt 1,812 to 1,235, according to state records.
The mayor told the News Service, “It’s going to be very difficult. It’s going to be a hard sell.”
“He’s just in a bad situation, and it’s not his doing,” Perry said. He said, “Should the override fail, he will cut the budget. He’s committed to me he would cut the budget.”
Without the override, North Adams will face additional layoffs, which was the “Plan B” this year before the council approved his fee increases, Alcombright said. He said even with the fee increases the city didn’t fill 11 school department positions and six positions throughout the city.
“The thing that’s suffered the most really has been our schools,” Alcombright told the oversight board, a public body that determines when municipalities can issue bonds through the state. The borrowing makes use of the state’s better bond rating and is secured by the regular local aid payments from the state to the city.