Posts Tagged ‘IPS’

On Thursday May 5^th, Trenton’s City Council will vote on an administration proposal to sell a bond (i.e. take out a long term loan) to pay a debt to the Internal Revenue Service caused by our payroll company (IPS) having stolen employee payroll taxes.   The amount of money is large, $4.7M so paying for it out of Trenton’s current funds is impractical.

As of this writing neither the public, City Council nor I know the proposed term of the bonds (I assume 15 years),  whether this is all that Trenton will owe (do we owe the State of New Jersey money?), will we recover money from IPS (the thief) or even how did this happen?  The City of Trenton has been stingy on letting taxpayers know what’s happened to their money.   That’s too bad but blogger Kevin Moriarty has done a great job writing about it and actually researching what’s going on.

I’m hopefully calling this a mistake because our administration shouldn’t have been so lax in its supervision of IPS.   It was a mistake to renew IPS’ contract even after the city was warned that IPS hadn’t been paying payroll taxes to the Federal Government.   Kevin’s research is turning up facts that potentially make this worse than a mistake, but for now I’ll chalk this up to plain old bad management in City Hall.

Reinvent Trenton mostly restricts itself to the economic issues and that includes how we use the budget as a policy tool.  So when a proposal (as vague as it seems) gets floated to fund a large $4.7M mistake made by the current administration over the next 15 years, in order for future voters to enjoy paying for a current problem, I take notice.

Responsible money managers know as a basic fundamental tenet that long term debt should only be used to fund long term assets.   We fund new water treatment facilities, new garbage trucks and even new hotels with long term debt (i.e. bonds).    We do that in our personal lives as well, our houses and cars are funded with long term debt, but not our clothes and food.

This $4.7M payment is a current liability and if we don’t have the funds in our budget we have only two responsible options:

1) change our budget by cutting something, or

2) fund it with short term debt (2 years or so) and raise taxes to make the payments.

Funding this mistake should happen during the course of this administration.   Spreading out our pain over 15 years deflects responsibility for this monumental blunder to future Mayors and future generations.   As voters and taxpayers, WE are responsible for this administration and this City Council, therefore we are responsible for the pain that our voting decisions have wrought.

Our decisions about how to budget and fund our operations are important.  They’re important in both matching priorities to our precious tax dollars and they’re also important in matching the benefit (or pain) of an expense to the actual taxpayers who will receive the benefit, or pain.

I know that none or our elected officials want to burden current taxpayers with this $4.7M mistake.  I’m sure that some voters would prefer to kick the cost down the road.   However, we are stewards of the financial health of our city.  Pushing this mistake into the future is both wrong and unfair to future voters.

Living in Trenton its easy to understand the appeal of Donald Trump’s message.

As a city, we’re losers so often that it just feels normal. So when we hear a guy talk about turning that around and being winners again, or just doing things well (as a government) it’s attractive. You wonder, what would that feel like?

What would it be like if we didn’t have our money stolen, if we could hire a real IT firm, if we could enforce our laws (big ones and small ones), if we had a tax policy that didn’t punish new investment?  What would it be like if we could communicate and enforce trash disposal policies instead of seeing it thrown all over our streets?

What would it be like if we didn’t get confused by letters saying our buildings were vacant, our water bills were past due and our taxes weren’t paid when they really were?  What would it be like if our water department weren’t running one illegal scheme after another out of their building?

What would it be like if our leaders could be transparent about the city’s issues? What if they didn’t brawl at public meetings?  What would it be like if we didn’t have to file Open Records Act forms to get information from the city, what if they just posted it online?  What if our Mayors didn’t get sent to Federal prison?

What would it be like if our snow was plowed, our potholes were fixed and our broken sidewalks and streetlamps were restored to their original state?

What would it be like if the only hotel in town weren’t about to close and taxpayers hadn’t spent $65M to build it?  What if hockey teams and arena football teams didn’t fail in Trenton?  What if we didn’t give away prime real estate to “connected” non-profits that don’t pay property taxes?  What if we could have a budget passed before the fiscal year starts?  What if we could pay for our own schools?  What if they actually graduated most of the kids?

What if the contaminated dirt at MLK school had been dealt with honestly?  What if we didn’t invite corrupt developer Robert Kahan in to Trenton? What if we didn’t fall for the Manex ponzi scheme? What if we hadn’t turned the historic Douglass House in Mill Hill Park into a drug den? What if we hadn’t forced the Broad Street Bank to be rent controlled? What if we hadn’t ignored Chambersburg’s concerns before the restaurants left?

What if simple building inspections only took 4 hours (like in Philadelphia) instead of 3 weeks?   What if you could communicate with the city through its web site and via email?

What if our property tax rate wasn’t the highest in New Jersey (the state with the highest property taxes in the nation)?  What if drunks and drug dealers didn’t infest our streets?   What if thieves were actually afraid of being caught?

What would it be like if we could recommend that a friend move to Trenton?

What would it feel like to live in a city of winners?