In a recent post about the latest Executive Partners, Inc. (EPI) involvement with the City of DeKalb as its financial consultant, I expressed anxiety about a proposal to privatize the city’s water.
Turns out, that’s not the EPI proposal for the Water Division, and I’m sorry to have led you astray.
It’s a PILOT (not pilot) program. PILOT stands for “payment in lieu of taxes,” and is sometimes spelled PILT as well.
Among EPI’s tasks this round is identification of potential new revenue sources. One of its suggestions is to add up the assets of the Water Division, calculate what Water would be paying in taxes if it were a private company, and then charge us the amount of the calculation.
A preliminary assessment shows net assets and potential annual in-lieu tax payments to be $26 million and $186,000, respectively.
Again, sorry for the error.
I’ve re-visited previously published revenue tables in an ongoing effort to monitor DeKalb’s financial recovery. Are we yet on solid financial ground? Make the jump to see what you think. (FYI this is a long one, folks.) Read the rest of this entry
Dear City of DeKalb,
I would be OK with your raising my water bill $80 this year if it were going toward something water-related like paying Water Division personnel, replacing water mains or painting towers. Instead, I know much (if not all) of the increase is going — as $500,000 from Water already goes annually — to the General Fund for nonessential stuff you still insist on giving yourselves, such as magazine subscriptions, car allowances, and reimbursed “business” lunches in Opportunity/Innovation Central.
Blood. Turnip. Just sayin’. The borscht train is about to run off the track.
(Yeah, I know: mixed veggies. Long day. I’ll try to do better with the property tax bill.)
Minutes of the January 12 special joint meeting of City Council and Financial Advisory Committee yielded this:
Mr. Espiritu discussed the fund balances along with suggestions to make them sustainable. He recommended that the General Fund build up a 25% fund balance with the City setting aside 5% per year over a 5-year period. Also, the Water Fund should attain a 25% balance with rate raises over a four-year period.
The Water Division has an FY 2010 budget of $4.8 million (PDF pp. 95-97), which incidentally matches up pretty well to the projected water sales revenues. However, it costs only $2.8 million to operate the Water Division. Where does the other $2 million go? Read the rest of this entry
They did it again. Last night at Council (CoW), while discussing the city’s financial outlook, it was reported that the Water Fund is operating at a deficit, and, whew! good thing they raised water rates or else it would be really out of control!
What a crock. The Water Division is a money maker (pp. 96-7). What happens is, the city transfers $500,000-$525,000 every single year to the
Black Hole General Fund. In FY2010, the Water Fund will also pay out more than $800,000 in debt service and loan payments. They siphon, then have to borrow money for–what?–repairs probably.
You know, between the debt distributed across four funds, underfunded pensions and that $29.4 million post-retirement insurance liability (which will not even be mentioned until after the budget is passed, unless one of us brings it up) we really are in hock up to our eyeballs. It’s anybody’s guess as to how long this house of cards can stand.
The level of trust we should put in city government, however, is not in doubt at all.