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Township Manager Paints Grim Picture of Montclair's Finances

League of Women Voters held a public forum at which the Township Manager spoke of the budget Monday night

Township Manager Marc Dashield told a small group of Montclair taxpayers to think of their town as a medical patient. In 2009, the idea was to stop the bleeding—and then the idea was to move on to triage. "And now we're doing the treatment," he said.

To prove just how dire Montclair's financial situation has been, he noted that $2.1 million was paid out as a result of tax appeals in 2010.

"[Part of] the surplus that we usually [have on hand] had to be used to pay for this which means we went from having a surplus of $1.5 million to having a surplus of $800,000," he said.

That was just one dismal fact presented by Dashield as he discussed the implications of the proposed 2011 Township budget at a forum Monday evening sponsored by the League of Women Voters of the Montclair area.

Dashield started his talk by speaking of the reason why a 0% tax increase is most likely impossible: fixed costs.

He said that fixed costs—such as insurance and pensions—make up $40 million of the proposed $70 million budget.

In addition, the Township's already operating with a "skeleton" staff, getting by with a workforce reduced by 40 people since 2009.

"We have had to cut $2.3 million in fixed costs," he said. "This is why we're in this crisis."

The impact of budget cuts already is being felt in many ways, Dashield said, noting that the repercussions include an older workforce picking up trash.

"We have an older workforce because of layoffs and so we have more people getting hurt and this is having an impact," he said, adding that the Township is forced "on some days to do single-source recycling."

Although extreme fire and police layoffs have not occurred, he said that each year the workforce in these departments is being reduced because people who retire aren't being replaced.

"This year we're losing a captain and a lieutenant and a sergeant," he said.

Dashield's proposed budget cuts $800,000 from the library and also reduces the code enforcement staff by 40 percent and the engineering department staff by 30 percent.

"People say 'why don't we reorganize the town and the way it's run?' ... but we are reorganizing the government every day," he said.

Striking a more optimistic note, Dashield also expressed enthusiasm for the South Park Street renovation project that was recently approved.

Dashield added that developers have expressed interest in building a hotel in downtown Montclair.

"We've got the greatest business district I've seen anywhere," he said.

But, Dashield admitted, the Township needs to start really getting to work on these improvements and then "connecting" those improvements.

"If there's a new hotel and new business along South Park Street then this will benefit everyone," he said.

When asked about parking, and the loss of some spaces due to the South Park Street project, Dashield said there are always places at the Fullerton Deck, adding that the Township is "looking at making improvements there."

Turning to the property revaluation, he reassured the group that the process could be completed by the end of this year.

"It's not a full revaluation in that [assessors] don't visit every house but they visit a certain number of houses in town," he said. "We need to adjust the whole base in this town."

When asked what he thought of the recent report by the Operating Budget Advisory Committee—a committee of residents appointed by the Township Council to examine the budget—Dashield said he found it "reassuring."

"The things they are talking about are things we're already looking at," he said. "The basic report showed that we're pretty much on the same page."

Finally, when asked what he'd do if—hypothetically—he found a check for several million dollars on his desk in the morning, Dashield said he'd use the money to stabilize the surplus, put more money back into the library, and give a boost to a struggling Department of Community Services.

"The real way to deal with our problems is to promote economic development," he said. "We need to bring in more commercial ratables."

 

theclubcantevenhandleme May 02, 2011 at 01:52 AM
Bronwyn You are so upset that I complimented Chris, that you resorted to ad hominem attacks against Chris and me. I don't think you read my post - did I mention dismantling any social program? You are probably one of these people who discuss the breakdown of civil discourse as a threat to progress, and then you turn around and say my brain is "club like", and our viewpoints "narrow, misguided, selfish" And here is the kicker, you seem so threatened by free speech, that it sounds like you would like to censor the internet! The irony is that the internet is there for people to express their opinions - this isn't Libya or Syria. Very hypocritical, as I am sure you see yourself as enlightened and open-minded. Can you be respectful? I hope so. Running out of space here but will post again about the rise of hedge funds, Stiglitz' piece, and other points raised. Club
chris May 02, 2011 at 02:15 AM
No it's a real travesty when people that are making 30k end up making 25k or worse lose their jobs all out. and that's what happens when you force billionaires to becomes millionaires in a mis guided, bleeding heart approach to economics. its sounds good on paper, but doesn't work in reality. all will be less off, not just the wealthy.
Bronwyn May 02, 2011 at 02:23 AM
Please do send me some evidence for your statement, Chris. Some kind of economic analysis with some data that supports your statement above. You continue to ignore the real problem of the ever-widening income disparity and keep painting someone like me that disagrees with your extreme view as a bleeding heart who is completely unrealistic and not pragmatic. I think you will find that most people support capitalism and see its many virtues yet feel that greed has run amok and things are out of whack.
walleroo May 02, 2011 at 02:28 AM
China may not quite measure up over the past 200 years, but the next 200 is up for grabs, and they're looking pretty good these days--they've been racking up 10 percent GDP growth for more than a decade. And guess what, Beijing controls EVERYTHING. That's one government that knows how to run its economy, eh?
walleroo May 02, 2011 at 02:41 AM
I also am amazed that the founding fathers were able to foresee a world in which all this capital is sloshing around the globe. Gosh, they sure were prescient! And of course Alexander Hamilton on Credit Default Swaps is still required reading at Harvard B School.
chris May 02, 2011 at 03:00 AM
Wow, the economic naivete on this site. China has four or five times the population that we do and has been a dormant economy for decades, or make that centuries. their economy is still smaller than ours even though their society has been around for ions longer. Any schmuck could grow their GDP at 10%, even a communistic regime, when they are producing at 3x-4x less than the U.S. on a per capita basis. Beijing is making more moves towards capitalism now than they have ever before and whaddya know, their economy picks up! Amazing concept huh?
Bronwyn May 02, 2011 at 03:03 AM
Funny that you should talk about economic naivete, Chris, while espousing trickle down economics.
Joe May 02, 2011 at 03:20 AM
Here are some telling UK hospital stories: An American expat living in London accidentally put his hand through a pane of glass while playing football indoors with his son. It sliced his wrist quite badly. When his wife entered the emergency room a few hours later, she over heard the two doctors talking about her husband. The conversation between the two doctors was, "Yes it probably could be fixed, but that surgery will take hours. I don't have hours, do you?" "No. Right, then, we'll just have it off [the hand]". Fortunately, she was a savvy former NYC attorney who shouted "back away from my husband now!". She got a private doctor to mend it well enough to travel back to the states where surgery was successfully performed. They live in the states now and he has full use of his hand. A different American expat was at a meeting in London where his client collapsed from heart attack. He called their version of 911 and got put on hold for about 5 minutes. The man started coming to. Our friend gave up with the emergency call, got the client into a cab and asked the driver to get him to the closest hospital. When they arrived at the hospital, they waited a couple of hours. Finally our friend asked to see a doctor. The response was "There are no doctors on duty now". A friend's brother went into hospital to get his appendix removed. He caught that horrible virus rampant in hospitals there and unfortunately never came home. I'll stop here.
Bronwyn May 02, 2011 at 03:27 AM
Anecdotal evidence! How convincing. Case closed.
theclubcantevenhandleme May 02, 2011 at 04:10 AM
Agreed. Socialized medicine is a failure. Case closed.
Bronwyn May 02, 2011 at 04:23 AM
You do realize, "Club" that there is just no middle ground here. I mean, there are many nuances one could debate, but there is nowhere to go with you and Chris and me. Your mind is made up, you have your opinion and why let any facts get in the way of it. Most people on this site who do not agree with you are actually moderates who can see that things are not black and white. But you have one world view (100% capitalism!) and it's really just a waste of time for me to even engage. And it was so odd, this suggestion of yours that I would like to censor the Internet. I was merely commenting that people with extreme views didn't use to have the audience that they do now and this is because of the Internet. Without the Internet, a verbal statement just disappears into the ether and now it lives on and is read by many. I just think it's unfortunate sometimes but I'll take the good with the bad and certainly do not propose censoring the Internet. But I will say I am sorry that I said you had a club like brain. As far as insults go, it wasn't even a good one, and I do apologize.
Bronwyn May 02, 2011 at 04:34 AM
And Joe and Club, here is some bedtime reading for you. There isn't much anecdotal evidence here (that's a good thing, btw) but it's compelling nonetheless: http://www.nytimes.com/2007/08/12/opinion/12sun1.html?pagewanted=1
walleroo May 02, 2011 at 04:35 AM
Osama bin Laden used socialized medicine, and look what happened to him. Case closed!
Bronwyn May 02, 2011 at 04:42 AM
An airtight argument if I've ever heard one. Case closed.
walleroo May 02, 2011 at 05:27 AM
This case has been closed and re-closed so many times I think the hinges have come loose.
Montclair parent May 02, 2011 at 04:00 PM
Chris likes to say that taking money from the rich and giving it to the poor never works. he's got it backwards. in the last 30 years, the rich have been taking money from everyone else. and it doesn't work because it doesn't trickle down.
Butterfly May 02, 2011 at 05:07 PM
Sorry, but what you wrote there is more telling about yourself than about the UK healthcare system. Fact is that the US healthcare system is so inefficient that it can not cover its population (40+mil uninsured) and is still more than double as expensive per citizen (note: not per insured!). If people would be serious about budget and healthcare, the US should adopt line by line the canadian or UK system. Matter of fact, any industrialized nation could serve as a blue print and any of those would be cheaper and better than what we have here.
Butterfly May 02, 2011 at 05:14 PM
The IMF just recently predicted that the GDP of China (based on PPP) will over take the US GDP by 2016; that only 5 years away... economic naitivé ... really ?
theclubcantevenhandleme May 02, 2011 at 06:39 PM
Bronwyn, that was indeed a weak insult, but I can tell you felt a little guilty about your suggestion to censor the internet, because that wouldn't be very tolerant or in the spirit of liberalism, would it? 100& capitalism? hardly, 60% of the US receives some form of entitlement. Let's talk about compensation. Exhorbitant hedge fund manager pay was a result of the US govt bailing out LTCM in '98 (Larry Summers, Rob Rubin, Greenspan - "The Committee to Save the World"). The bail-out sent a signal to h.f. mgrs that they were sytemic and would never be allowed to fail. This was the gambit that Dick Fuld at Lehman leading to their demise and the taxpayer $800bn TARP. Bailing out LTCM led to hedge funds taking inordinate risk, with high upside and limited downside. But let's face it, the govt created this monster. But let's get past hedge fund guys to other highly compensated people in society - do you have any problem with A-Rod (30mn p.a) or Bono from U2 (900mn net worth)? Are they worth it or should there be "windfall profit taxes" on musicians and athletes?
Bronwyn May 03, 2011 at 01:06 AM
Club, I did not suggest censoring the Internet. Good Lord, brush up on your reading comprehension. Stating that it's unfortunate that other people metabolize glucose just to read your vacuous posts is not the same thing as proposing censorship. Whew, tough one, aye? One thing, LTCM was not bailed out in 98. Investors lost the money they had invested. You have no idea what you're talking about re: hedge funds, it's kind of funny, actually. So your whole premise is wrong and I can no longer burn any more glucose on you.
theclubcantevenhandleme May 03, 2011 at 01:43 AM
Bronwyn, LTCM was most certainly bailed out. You have now proven yourself to be a fraud, which undermines your credibility on all other topics on this board. In spite of your ignorance on a wide variety of topics, I believe you have the right to continue to post whatever you want on the Internet. I recommend you take an Econ 101 course at Montclair State - you will learn about supply/demand, risk & return, as well as moral hazard. Perhaps then you will be able to keeo pace with Chris.
walleroo May 03, 2011 at 02:29 AM
I don't think the government bailed LTCM out, club. A bunch of bankers did (with some arm twisting) as I recall. But it was a long time ago, so my memory may be bad. I did read somewhere recently that LTCM was unfairly criticized afterward for relying too much on fancy schmancy risk models (ie, math), when in fact it turned out they had taken many steps to mitigate over reliance on those models, and the mistakes were just repeated by others... And the wheel turns.
Bronwyn May 03, 2011 at 02:54 AM
It's certainly plausible to claim that what the Fed and Wall Street banks orchestrated around the LTCM crisis added to moral hazard, but the principals at LTCM, and their investors, suffered large losses. Hedge fund managers have large upside with limited downside not because of some promised government support, but because of the nature of compensation structures there and throughout Wall Street. This problem was especially prevalent at the banks, which is where the inordinate amounts of risk were really being taken. To make a clearer statement regarding LTCM - to claim that the Fed's actions suddenly signalled to HF managers that they could take ridiculous risks in the knowledge they would not be allowed to lose is simply untrue. The former LTCM employees I knew, who went from thinking they'd be retiring very young and very wealthy to realizing they had to largely start over, certainly didn't take that message.
walleroo May 03, 2011 at 03:39 AM
LTCM notwithstanding, moral hazard is a far bigger problem with the banks than with the hedge funds. And it's true that hedge funds are better run than the banks. My problem with hedge funds, though, is more fundamental than that. They exist to exploit structural weaknesses in the global financial system, a mishmash of countries and currencies and capital to-ing and fro-ing around the globe, which is already unstable and disjointed in the best of times, and vulnerable to manipulation. I don't buy the argument that hedge funds grease the wheels of capitalism and make money for little old ladies' pension funds. Oh, sure, some institutions invest in them. But I think they basically exist to make the very rich a lot richer. Sometimes in the course of going about this business, they expose the financial system to big risks that are ill defined, poorly understood even by the hedgies themselves, and almost completely hidden from public view. Sure, there's nothing illegal about any of this, but I believe there is something immoral about it, or at least amoral. Messing with a financial system that people depend on for fundamental things, like making a living and feeding their families--not good.
theclubcantevenhandleme May 03, 2011 at 04:25 PM
Agree with your comments on moral hazard wholeheartedly, but what is the solution? A counterparty in a transaction will ultimately have to fail - that is why we have a bankruptcy procees in the US that can provide for an orderly reorganization or unwind. And the model for hedge funds is 2% fee and 20% carried interest No one is holding a gun to the heads of state pensions, endowments, Ivy league institutiosn to force them to invest in this model. But they do, because they are all chasing "alpha" (excess return above an index). As long as the Fed keeps printing $$ (QE1, 2, 3(?)...34 ?), asset inflation will persist and these guys will make a lot of money. But the Fed believes inflation is the lesser of 2 evils (the other evil being deflation), much to the delight of h.f mgrs and to the dismay of the middle class.
Don June 01, 2011 at 05:28 PM
I'm commenting on the statement made above about the UK's NHS. The fact is that most Britons get far better healthcare in the UK than all but the very richest Americans get through US style "managed care" here. (the US is the global poster child for how NOT to do healthcare.) Patients in every other developed country have more access to modern effective drugs and mainstream effective therapies than Americans do. HMOs are pushing down the "standard of care", with the result that Americans get worse healthcare relative to the other developed nations - worse each year. Thousands of patients in the US die each year from preventable causes. Britons and Canadians may bitch about waiting lists for elective surgeries but when they need care fast they get it. We increasingly don't. And thats killing people. Ask your European friends if they would trade their healthcare for US healthcare. They will look at you like you are nuts for even asking. Travel a bit, you'll see.
Nurse June 01, 2011 at 08:25 PM
Thank you Don (above 6/1)!! You speak the truth!
Don June 02, 2011 at 03:18 AM
Chris, you don't know what you are talking about.
susan monaghan July 13, 2011 at 09:35 AM
what a racquet - mri scanners are good for business (and needless MRIs) - (what happened to good history taking/physical examination..MRI when necessary here in US?)
susan monaghan July 13, 2011 at 09:39 AM
tho so off the original topic

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