I've written here before about the political activity that transpires in Northampton's public school system. Northampton mayor Mary Clare Higgins, a former day care teacher with the defunct Hampshire Community Action Commission, makes regular forays into the schools and by charter chairs the city's school committee. A few years ago she started a youth commission which is comprised of soon-to-be eager new voters at the high school. It meets regularly in her office at city hall as opposed to meeting with (hopefully) nonpartisan school counselors or teachers on school grounds. The Northampton Education Action Team (NEAT) is also active in the school system and plans to hold meetings at public schools where Higgins will speak in favor of passing a general property tax override this coming spring. Add to this the fact that Higgins performs annually at Transperformance, the annual musical event of otherwise well rehearsed mimics that occurs on behalf of the Parent Teacher Organizations of the city's public schools, and the scene is complete. Clearly no one builds political capital based on a relationship with the public schools like Higgins. It is the strategy that keeps getting her re-elected in my view because mayoral challengers do not have this kind of access to such an active voting block.
Moreover, Higgins is robbing Isabellina to pay Russell, that is, she's planning to take funding that could otherwise go to the school system in order to build a new police station, and her base of supporters seems none the wiser. (Interestingly it was reported recently that Northampton's superintendent Isabellina Rodriguez is a finalist for Amherst's top school post so it appears that she is ready to leave.) It is my opinion that Higgins derives her strongest political support from the very people she is starving of funds. How fancy is that? While recently she stated in The Republican that the people have a right to vote on what the municipal cuts might be, if any, in the next fiscal year due to budget deficits, she evidently didn't think to ask the people when she decided to expend taxpayer monies to build a new police station or senior center or DPW headquarters or to expand the landfill. Go figure. While it is true there is a national recession, the judgement applied to local spending decisions counts too when considering a community's economic well being and therein lies the stumble.
Higgins' funding philosphy is unlike former Mayor Mary Ford's whose approach was to successfully convince voters in the early 1990s to pass three debt exclusion overrides in order to renovate the middle and high schools respectively, and to construct a new fire station. Debt exclusion overrides eventually disappear as the debt is paid off and the voters know what they are buying, more or less, with their tax dollars. Ford leveled with the voters and the voters rewarded both her and the city by approving the additional spending. In contrast, by issuing municipal bonds without voter approval as is Higgins' habit, for items like the Senior Center, the new Police Station, the proposed landfill expansion and the proposed new DPW headquarters, the mayor in her discretion is obligating the city to make principal and interest payments to investors while diverting cash from other uses, like the schools. It is no wonder Higgins favors a general override because that type of override acts as a cash grant, that is, she has discretion over how the funds are spent, unlike a debt exclusion override where the funds are managed for a specific purpose.
Consider for a moment the senior center's funding. According to the city's finance director Christopher Pile, the city issued a 20-year $3.91 million general obligation municipal bond at 3.88% interest. At the end of the term the city will have paid a total of $1,546,675 in interest payments to investors. To make the bond payments the city has allocated $1.41 million to the general fund for debt service and will use $2.5 million in Community Development Block Grant (CDBG) monies, grant monies that could be used for community housing to aide senior citizens and low income people among other things. By locking up CDBG funds in this way organizations like the Valley Community Development Corporation are turning to Community Preservation Act funds for items like the controversial single room occupancy housing projects recently approved by the city council. According to Pile the total interest to be paid for the proposed police station would be at least $7 million and the city has already sunk more than a $1 million into its design. The projected annual bond payments on the police station alone will total about $1 million per year, money that otherwise could be allocated to the schools. Combining the two obligations, the city will be paying out at least $8.5 million in interest payments total, and the bonds for both the proposed landfill expansion and DPW building will be added to that. In addition, the bonds for the landfill will likely be paid, at least in part, from landfill operating revenues, which may reduce the $468 thousand host community fee that the solid waste stabilization fund pays to the city annually, so the direct economic benefit of operating the landfill might dissipate in the future.
Though it is common for government to engage in borrowing for public works projects in order to stimulate economic growth, as President Obama is advancing at the national level through a stimulus package, there is an appropriate time and place for such action at the local level. I argue that in the intermediate term the economic multiplier benefits of constructing the senior center and police station with local dollars are eroded by the $8.5 million plus in interest payments the city must make.
Moreover, much of the money for the proposed police station bond payments will likely originate from the city's free cash funds which will be deposited into stabilization funds before they are expended. In short however, there is no long term financial plan or funding in place to repay the costs for the new station. If the station is not constructed the free cash could be used to help maintain the school system, at least in part, until the global economic crisis and the Iraq and Afghanistan wars are over. In other words, Higgins cannot continue to govern on credit as if we are not a nation at war, as funding shortfalls from the federal and state governments respectively are nothing new and are expected to continue. That is the stark reality that the country must accept and evidently Higgins prefers not to. Blaming Bush & Company may serve to divert attention, but the facts are what they are, Northampton has not been adequately prepared for the proverbial rainy day and the policies and systems put in place by the Higgins administration are beginning to break down as evidenced by a projected $5 million shortfall for the upcoming fiscal year.
In order to address this deficit, the prospect that Higgins is gearing the community up for an override is a gamble that will further divide us when we need more than ever to come together and to live within our means. People will place blame, call each other names and make petty accusations aimed at fellow citizens. The community's collective anger will escalate and people will be left wondering, is this the kind of leadership we need?
There is some hope though. The Gazette reported earlier that the city is applying for the federal stimulus funds to be used for the proposed police station, so the level of bonding described above might not come to pass, which means that there could be more money available for the schools. However, federal funding is more likely to be used for roads projects rather than for buildings so this may prove to be a false hope indeed.
The last general override Higgins attempted in 2004 during better economic times, for $1.7 million, failed by eight votes. The following year under a citizen initiative the Community Preservation Act's property tax surcharge of about $600 thousand passed by 175 votes. Presently Higgins is promoting a 43% increase in property taxes for people who own property located within the proposed business improvement district downtown, which calls for annual support from the city (aka taxpayers) in the tens of thousands of dollars, including $50 thousand annually for the Academy of Music. Should the BID be anacted I suspect that the general override attempt will fail this spring and our kids will be left with inadequate resources. With a projected fiscal year 2010 budget deficit estimated at more than $5 million, the likelihood that an override will pass at that level is quite slim. As unpleasant as it seems, cutting 100 municipal positions in order to reduce the size of our local government might be just the beginning.
It is important to remember at this time that unlike the private sector, market forces do not impact the size of government in the same way, which is why Obama recently brought in an efficiency expert to streamline the federal government by terminating ineffcient programs and departments. Clearly in times of crisis it is important to differentiate between what we need and what we would like. If the city moves forward on building the new police station and the voters reject a property tax override, the schools will be further decimated. Could a school closure be far behind? In the interim as an alternative could the police department utilize vacant space in Memorial Hall where the senior center used to operate from or in the James House located nearby? That would free up some room in the crowded police station on Center Street until the economy recovers and municipal bond interest rates are more favorable.
