What we can afford

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By Editorial Board

When times are tough financially, people have to make difficult choices and modify their lifestyle. You might have to buy a used car instead of the new one you really want, this year’s vacation may not be as long or as nice as last year’s and you might have to eat a sandwich at home instead of going out a little more often than you like. Many of our decisions and behaviors are driven by the practicality of what we can afford more than what we really desire. That lesson applies to individuals but it also has to apply to government entities, particularly local ones that can’t just print money.

For quite a while now, members of Chester City Council have deferred many spending requests by saying they don’t know how much money the city actually has. Not having a finance director for two full years led to a great deal of disarray, including getting behind on audits. With Jerry Baker having been hired to handle the city’s money last year, there is now a clearer picture of where Chester stands in terms of dollars and cents…and where it stands is on very shaky ground.

At one point in February, the City of Chester had barely over $37,000 in its general fund. Now, the city has other accounts but many of those can’t be touched for paying day-to-day bills and are earmarked for specific purposes. There is not a hard-and-fast rule about how much cash-on-hand a municipality should have, but the recommended amount from the Government Finance Officers Association is a minimum of two months of total expenses. Obviously, $37,000 doesn’t come close to that. In a Monday finance committee meeting, Baker admitted the city is having a difficult time making payroll.

There probably isn’t one area to place blame for the city’s funds having dwindled to such a meager total. Some of that is a product of something that can’t really be helped, which is the city’s overall economic climate. The downtown business district has at least as many empty storefronts as occupied ones at this point and some of them that are occupied house non-profit or non-commercial entities. The population has dropped which means less of a tax base and the population has aged, meaning more Homestead Exemptions, which drops it even further. We hope those realities change, but those are realities right now. Some of the blame has to lie on spending too much money, though. When a citizens group asked for help paying for the annual “Christmas in Chester” event last year, they said they needed $12,000 but had a private donor who had pledged as much as $10,000 to make up whatever difference existed. The council voted to give them the full $12,000 instead of the $2,000 that they were actually being asked for. Under normal circumstances that wouldn’t be considered a lot of money to a municipality, but when said municipality has only $37,000 in the bank, it is. From what we’ve seen and know, there are more egregious examples of overspending, but those weren’t done in an open meeting for all to see like the previous example. Credit cards were issued at one point to individual departments a while back. They’ve since been taken back by the council, but only after they were used. That was a the worst kind of mistake…a repeat one, since credit cards floating about was one of the contributors to getting the city in serious financial straits just 10 years ago.

Whatever combination of spending and decreased revenue got the city to where it is now, something has to be done to fix it. Behaviors have to change and the way things have always been done can’t apply anymore. One step that has to be undertaken, painful as it is, is to actually adhere to the hiring freeze that is supposed to have been in affect for several months. Some members of council seem inclined to give the OK on hires because “we budgeted for the position.” Budgeting for something and actually having the money to pay for it are two totally different things, however. It may mean shifts have to be changed, some roles may be altered and fewer people doing more work, but the freeze needs to be an actual freeze at least until the city is on firmer financial ground.

Allowing a certain amount of attrition isn’t the only painful decision the council will have to make. At one point, former City Administrator Jeff Kerr floated the idea of outsourcing the city’s waste pick-up, which he said would result in fairly substantial savings in terms of manpower and equipment. Indeed, the city bought new trucks two years ago that cost $250,000 each. Depending on whom you ask, the city either did or didn’t have informal talks about essentially allowing the county sheriff’s department to absorb the city police force in the past two years. We aren’t endorsing either idea, but those are the kinds of things the council has to look at. They need to pinch pennies but also take a long view on how to reduce spending in significant ways because there is no other choice. Things may not be able to continue as they always have because things are now different than they’ve ever been. There may be some painful cuts coming, but things can no longer be about what the city wants. Decisions must be made based on what the city can afford.