**Correction and clarification added 11/30**
In DeKalb’s fiscal year budget for 2008, $214,000 was allocated in the legislative department budget for social services funding. Two years later, the amount was reduced to $150,000, because the city was still experiencing post-Great Recession budget crises.
The funding has never been restored. It’s been at $150,000 ever since, split between about a dozen agencies/programs.
In the proposed FY2017 budget under consideration now, administrators went so far as to zero out this legislative line item altogether. (**correction/clarification added 11/30: it still appears as a line item, though moved to the community development department, and not at the reduced amount discussed Monday.) Council quickly restored the funding Monday evening amid public outcry. However, I doubt that serious discussion of actual policy took place.
We do need to have that discussion. Should city government fund social and supportive services? If so, what’s the plan? Read the rest of this entry
Fun tidbit has come my way, and by “fun” I mean enormously dispiriting.
Freedom of Information Act (FOIA) request dated 10/31/2016:
Please provide examples over the past three months (8-1-16 to 10-31-16) of analysis documents produced by anyone holding the title “management analyst” within the city of DeKalb’s employment.
This request is entirely for the public good and in no manner represents a commercial request.
As budget discussions are underway it is critical that this response be returned in a timely manner. The results need not be exhaustive, a few such analyses per designated employee will suffice.
The time scope may be expanded at a later time depending upon the results of this request.
City of DeKalb’s response to this request for information:
No records were found for the time period specified in your request.
The city expects to pass a budget in a few weeks that takes effect January 1, 2017, as well as pass a possibly record-setting property tax levy, and the management analysts haven’t been analyzing a thing.
Last I checked, the so-called analysts make more than $60,000 per year in salary alone, and do clerical work such as responding to FOIA requests.
People have been asking me why their city property taxes went up sharply this year. While much of it has to do with your assessment, of course, here’s the rest of the story.
Until recently, City of DeKalb levied property taxes for pensions and FICA only. I went back as far as 2006, and the only years when the city levied for any other purposes are shown in the table, because collection of property taxes for bonded debt and for general corporate purposes is either new for DeKalb or a revived practice following long hiatus. Read the rest of this entry
A couple of weeks ago, I submitted a Freedom of Information Act request regarding DeKalb’s practice of buying gift cards for employees, the latest round of which occurred in December 2015 when City of DeKalb spent $5,400 on “employee holiday gift cards” for some 230 city employees.
Among other things, the FOIA request asked for the following: “Records that indicate the cards were properly counted as compensation and that federal and state withholding occurred.” The response was as follows:
No responsive records have been identified. The City determined that in previous years, the cards were not included within taxable amounts. The City has worked to ensure strict compliance in prospective years by eliminating these gift cards from proposed budgets; there is no proposed expenditure in the draft FY16.5 budget that would include gift cards of this
nature. That change in practice was made after an internal review of this matter by the City earlier this year.
Read here for the IRS rules specific to de minimus fringe benefits when the employer is a government. Cash and cash equivalents — yeah, this means gift cards, too — cannot be excluded from income and are always taxable, regardless of amount.
Oops. That’s almost $16,000 in untaxed compensation since 2013, guys.
Also, since the city included in its response no memos or other records of the elimination of gift cards for employees, we are free to assume that the “internal review” and decision to terminate the practice of giving gift cards occurred when administrators received my FOIA request dated April 21.
See the original FOIA request and response here.
It has come to my attention that clarification is needed on the post about the General Fund “special events” account named 8306.
If you contact City of DeKalb and they tell you that 8306 is for events such as helping with the expenses of July 4th festivities at Hopkins Park, that is 100% correct.
However, it is also correct to say that funds coded to expense account 8306 pay for employee events (parties and picnics) and special compensation (gift cards). The February 2016 expenditures report(p. 9), for example, included payouts for an employee potluck and a spree on gift cards for employees that’s becoming infamous. Read the rest of this entry
City of DeKalb has an account in its General Fund called “Special Events,” 8306 in the budget. I always thought special events were public events, such as the open house that was held for visitors to tour the new police station. Then I came across an expenditure of $5,400 for Target gift cards for employees that was coded to this expense account, which prompted me to look more closely. It appears to be an account that pays for employee parties and gifts.
Here are the amounts budgeted over the past few years from this account:
2012: $ 7,000
Even if all of the expenses are legit — and I’m not sure they are — the more-than-tripling of what’s budgeted into this account needs to be explained. I also note that the extravagance in this area comes on top of similarly large increases we’ve observed for membership dues/subscriptions and professional development expenses over the past 2-3 years.
But back to the question of legitimacy. Let’s consult the Illinois Constitution.
SECTION 1. GENERAL PROVISIONS
(a) Public funds, property or credit shall be used only for public purposes.
Are private parties and gifts for city employees a public purpose? I think not.
Yes, “is.” Emails obtained by Michael and Misty Haji-Sheikh of Preserve Our Neighborhoods show that even though collaborators ultimately rejected formal incorporation of College Town Partners in May 2014, the intention remained to suck sweet, sweet tax dollars out of City of DeKalb via Tax Increment Financing (not even getting into NIU and use of the NIU Foundation, though we definitely should at some point). There is no reason to believe the schemes were dropped, especially now that the mastermind has wormed his way onto the NIU Board of Trustees.
Yes, “schemes.” How else to describe the dreams of a local banker (and longtime Sanitary District trustee, by the way) to transform a college-adjacent neighborhood and get DeKalb to pay for the project. He apparently is so persuasive that the other officials involved, including our mayor and city manager, went along with him for months though their status absolutely precluded participation as partners in a private entity intent on spending public money over which they exert control. It was a gargantuan conflict of interest; we should find ourselves shaken by the apparent ignorance or disregard of their duties to the public while they spent oodles of staff time and other resources to bring them to the brink of a formal agreement without council’s prior authorization.
Indeed, we’ve not heard a peep of public discourse that hasn’t been tied to citizens’ dogged pursuit of information.
Click here to read the email indicating that College Town Partners might have been buried, but not outright killed. If the Shodeen people ever get their hotel and apartments approved, look for CTP to dig up the undead baby, give it a costume change and present it as the inevitable and desirable retail counterpart to Shodeen’s residential development.
Related post: Tim Struthers Gave DeKalb’s Mayor Talking Points When the College Town Partners Story Broke
Look at that nice, wide gap between General Fund revenues and expenditures during FY2011 and FY2012.
(All figures are actual as reported in annual city budgets, except FY2015 numbers are the end-of-year budget estimates and FY2016 are, of course, the projected amounts.)
What the gap represented was a huge reset of the operations (General Fund) budget that was accomplished by actively reducing the city’s workforce by some 20% on top of a couple years of attrition.
Mind you, we’d gone a couple rounds of tax and fee hikes by then, but it didn’t matter; city staff calculated at the time that if the reduction in force didn’t happen, we would be $5 million in the hole by the end of FY2011.
What the reset did was to fix the structural budget issue of personnel costs outpacing revenues during the Great Recession and the “flatlined” revenue period following (that DeKalb, by the way, still hasn’t quite overcome). A nice side effect was meeting capital needs. Following the reduction in force, there was enough money to put into the fleet, a new police station, and needed expansion/repairs of the fire stations.
But now, the gap is closing and, once again, money for capital needs has disappeared. And since most of the rise in expenses reflects increases in wages and pension contributions, it’s clear the reset has been squandered by the hiring spree that came after. Read the rest of this entry
Filed under: City Watch
, Payment Due?
| Tagged as: budget
City of DeKalb released its Comprehensive Annual Financial Report (CAFR) for fiscal year 2015, which ended June 30.
I’m sure city staff will also release the Popular Annual Financial Report (PAFR) as they did last year. It’s a dumbed-down version of the CAFR that nobody asked them to compile, but they get some sort of warm-fuzzy award for it, so it’s all good.
Let’s update some charts. First, the hiring news:
The hiring spree is still on.
The General Fund budget for personnel expenses this year is $26.9 million, a rise of 2% over last year and a net increase of $500,000 in this budget category. There are a couple reasons why the increase was “only” 2%. The primary reason is that a chunk representing another 2% was sent over to the Water Fund for Water to pay. They’ve also succeeded in reducing health care costs (something I’d like to compliment them on sometime, if only they’d stop annoying me for a minute with the Bozo no-nos).
But wages and pension costs are both increasing well above inflationary levels. I anticipate they will have to come up with $500,000-$700,000 more for this budget category next year.
In other words, despite the rosy picture staff will paint next month in an effort to persuade the city council to hire a human resources director, the council should no way, no how approve any more hires and, in fact, should let attrition do its work for awhile. Read the rest of this entry
David Patzelt of Shodeen Group, LLC, sent a nice thank-you letter to the DeKalb city manager for attending a meeting between Shodeen principals and city officials in the matter of Shodeen’s latest project proposal. The letter was included in the agenda packet for Wednesday’s meeting of the Planning and Zoning Commission. It outlines Shodeen’s arguments against the city’s insistence on its providing retail space on the ground-floor level of the apartment complex plan.
As you know we are a commercial and retail Developer, Builder, Owner and Management Company. Like staff, we too wish that the market in DeKalb was strong enough to support commercial/retail in the lower level of the proposed residential building. As we discussed with you, City staffs position on this being a requirement is unwarranted and unfounded. Even if the City will subsidize the rent as well as commit to a guarantee of rent payments, we do not recommend the addition of retail space at this point in time. Staff continues to be unwilling to accept this without any basis other than a “want.” Empty retail space should not be a “want.”
(The underlined words appear that way in the original.)
No, it’s not a matter of acceptance, nor just a “want.” It’s an actual requirement for the downtown business district. Staff can’t change it. Only city council can.
But an even larger policy change would be the use of rent subsidies and guarantees to get the project built the way the city wants.
We knew we’d have a tussle over TIF funding for redevelopment on this site. Has the city placed other subsidies on the table for consideration?
I’ve begun a Facebook discussion thread here.