The $1.66MM accounting error is now the mistake heard ‘round the world. I won't comment on how Plainfielders are feeling let down by the Administration again. There has been plenty of commentary on that.
I do want to address the solution proposed to the Courier News by City Administrator Marc Dashield. Mr. Dashield suggests dipping into the Reserve Fund. This is like putting a band-aid on a 3rd degree burn. Whether this will be necessary in the short-run remains to be seen, but regardless of that outcome a long-term solution is needed.
The Reserve Fund, for all intents and purposes, is an accounting concept. It’s not a savings account and should not be seen as a “rainy day” fund. In reality, it represents the difference between an organization’s current assets and current liabilities - in other words, it is the amount that would be left over if the City sold all of its assets for cash and paid off all debt owed within the next year. This is an important benchmark of financial health because it measures our ability to continue to pay immediate and ongoing expenses (long-term contracts, capital expenditures, etc) without having to take on too much debt.
This mistake is really just shining light on the City’s fiscal health. This additional, unexpected deficit brings total revenues lost to $5.2MM. What caused this loss? How will we address these losses in the long-term? Dipping into the Reserve Fund now may mean easing the tax burden today. But the Reserve Fund has limited resources. Unless something is done to address Plainfield’s financial health, taxpayers will eventually be burdened with higher taxes.
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4 comments:
Regarding the reserve fund: it is NOT the administration's call to dip into this fund to correct their incompetence, so Mr. Dashield's comments are way out of line. It is the city council that decides on this, not Mr. Dashield, Mr. Peck and the mayor. They are always spreading incorrect misinformation, time for them all to go. How much more will I as a taxpayer have to suffer??
The council should not ask tax- payers to pay for the administrations incompetency. We need elected officials that put citizens first. We are tired of being the least important component in the decesion making of the Green/Briggs agenda. The pay-for- play crowd that runs Plainfield needs to go. If there is to be a future for the Queen City, citizens must have the courage to embrace change. Throw the rascals out - elect progressive, articulate candidates who will put Plainfield first - not last. Or we are doomed.
"..for all intensive purposes..."
Should read, "for all intents and purposes..."
You don't want to come across sounding like the guy who lives up the street on the corner.
Thank you for catching that!
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