Public Watchdog.org

Why Is Hock Playing Hide-And-Seek On City Finances?

02.20.09

On Wednesday we lauded the Chicago Tribune’s editorial, “State of Corruption,” for getting in our collective faces for our continued tolerance of corruption and political sleaze from our public officials (“The Tribune Nails It,” February 18).  And we noted, yet again, that one of the ways those of us in Park Ridge contribute to that culture of corruption is by silently accepting the Culture of Secrecy practiced by our local governments.

The Culture of Secrecy, however, is not just those technically-legal-but-not-required (and most definitely not “secret”) closed session meetings that our public officials love to run into for any legally permissible reason.  Nor is it only simply our public officials’ having those “private” meetings with property owners, developers and business people, some of whom just happen to be campaign contributors (Hello, Mayor Frimark.  And say “hello” to Bill Napleton and Bruce Adreani for us, too).

It is also things that appear almost benign at first glance, but which provide many more opportunities for mischief when examined more closely.  A good example is what the City posts on its website, ostensibly in the name of “transparent” government.

Yesterday the City website posted a memo [pdf] to the Mayor and City Council from City Mgr. Jim Hock on “Third Quarter Budget Report.” In its very first paragraph, it states that the report is “attached,” but we couldn’t find hide nor hair of it on the website.  The same goes for those purportedly “attached” Uptown TIF fund preview pages it references.

Now, that missing information could be viewed benignly as a mere slip-up, an oversight, an “I could have had a V-8” moment. But it appears less benign and inadvertent once you read Hock’s memo and think about what he’s saying about the TIF funds and City finances generally.

Hock’s memo states that as of April 30, 2008, the TIF fund had “a negative fund balance of $2,697,000,” which doesn’t sound too good to us.  And that’s not the worst of it, because Hock goes on to report that – because the City is “committed by contract to budget and complete the other half of the Summit Road improvement project, which will begin in May” (who did that, when, and why?) – the TIF fund “will be owing the General Fund as much as 6.5 million dollars” by the end of the next fiscal year!

Yeow!  Welcome to the robbing-Peter-to-pay-Paul fantasy world of government fund accounting.  And because we’ve spent far more than a few hours pouring over the financial reports and budgets of the City, District 64 and the Park District over the years, we know that trying to figure them out is a lot like trying to decipher a Chinese menu…printed in Mandarin.

But speaking of fantasy worlds, how about this additional tidbit from Mr. Hock: “The premise that investment in our Uptown area will pay the City back plus stimulate investment resulting in tax revenues has come true.” [Emphasis added].

Can you tell us what color the sky is in your world, Mr. Hock?

Returning to the harsh reality elements of Hock’s memo, however, we discover that it’s not only the TIF fund that sounds like it’s on life-support by the General Fund.  As of January 31, 2009, the other City funds that “had negative cash balances” are: the Uptown Tax Increment Financing Fund (Is that another “TIF” fund?), the IMRF (public employee retirement), Municipal Waste (no comment), Emergency 911 (self-explanatory) and Special Service Areas (where an area of town gets specially assessed for some special benefit).  That doesn’t sound too good, either.

Hock goes on to explain, in typically oblique bureaucrat-speak, that the General Operating Fund (is that the same as the “General Fund” and, if so, why can’t you keep the name straight?) balance of $14 million “is not the same as cash.”  Translation: That $14 million is made up in large part of “debt” owed to the General Operating Fund by those other deadbeat City funds!

So, Mr. Hock, why didn’t you just come out and say that?  And why didn’t you also include in your report just how much of that $14 million is IOUs from those other City funds?  Are you trying to be too cute by half, or are you just following orders?

We wonder…no, we suspect…no, we’re pretty darn sure…that those attachments conveniently missing from Hock’s memo provide at least some answers to our questions.  So why, Mr. Hock, aren’t they posted on the City’s website with your memo?

And while we’re asking questions about City finances, here’s one for Mayor “Let’s Make A Deal” himself: When you brag about how you have kept the annual City property tax increase at around 3.3%, why aren’t you also telling the taxpayers and voters how the City, on your watch, has developed all these smoke-and-mirror funding problems…and posted a $1.7 million budget deficit last year…and is going to post a similar budget deficit this year?

Mayor Frimark?  Howard?  Anybody?  Bueller?

10 comments so far

This is a timely post because just today I got around to reading the latest issue of the “Spokesman”, city government’s periodic official communication to residents. The lead item was about the city’s budget process, which lasts six months (September to April) and will feature public hearings in March and April. Anyone know when those meetings are? I have started to get intersted and attentive to city government in the past three years and only now realize I’ve never seen the budget at all (my fault, not Frimark’s — I’ve just never asked).

Geez. My head hurts just reading this.

Guess I need to go to the Monday COW to see how Hock sorts all of this out.

Regarding the attachements that didn’t make the website… Mr. Hock, will you please be sure to bring extras so we can all follow along when you present??

I have read and re-read Hock’s memo, and if you read just what he says and then think about what he’s not saying, it sounds like the City is in shaky financial shape. Geez, Louise.

And what genius committed the City to $4 million (???) of additional TIF district improvements that have to start in May? This is the first I’ve heard about that, or is it that they don’t have to start in May but some preferred contractor needs the cash flow?

Watchdogs you said “Translation: That $14 million is made up in large part of “debt” owed to the General Operating Fund by those other deadbeat City funds!”

I don’t understand. Are you saying the City is reporting as positive a negative balance?!?! That the positive is a negative debt and not money it actually has?!?!

Based on what we’ve seen in the past from Park Ridge, as well as what we’ve seen when we’ve looked at other communities, it looks like the City is counting as part of the General Fund balance the money that is owed to the General Fund by these other funds.

It’s not unlike when the U.S. government borrows hundreds of billions from the Social Security trust funds to pay for government spending, yet the SS funds list that debt as part of their current value; or like if/when you borrow $20,000 from your 401(k) and the account statement shows a vested balance of X which includes the $20,000 you borrowed.

Am I to understand from Hock’s memo that the General Fund shows a balance of almost $14 million, of which $4.9 million is cash or investments while THE OTHER $9 MILLION IS IOUs FROM THOSE OTHER FUNDS?

Is Bernie Madoff the city treasurer?

No… it’s that Stanford guy!

So I was looking at the PR news on the internet this evenings and looking at some of the posts on topix. I saw the following story:

http://www.topix.com/city/park-ridge-il/2009/02/updated-2-24-park-ridge-mayor-candidates-split-on-police-station

Two things struck me. First of all, there is no question that everyone will have a clear choice in this election. There are very few gray areas.

Second,the paragraph near the bottom scares the hell out of me. The city manager has the primary role. He makes a recommendation. I am wondering what this really means. Soon to be Mayor Dave has already gone on record saying we do not to need to spend 16.5 or more on a police station – I agree. So what happens if Hock stands up in his primary role with all his facts and figures (it appears he is good with figures) and recommends we go ahead with the 16.5? How long is Hock’s contract?

Alpha, talk me down and feel free to call me stupid. It has been a few days.

Why is the Anioche Review even writing about this?

Don’t they have stuff in their own backyard to worry about?

MIKETOUHY,

The Antioch Review isn’t writing about this. What you see on the Topix site is (often) an incorrect attribution to the Antioch Review, as the story was picked up by the Topix Roboblogger.

That pick up is probably a function of how the Suntimes News Group’s (which includes the Pioneer Local Herald-Advocate) feeds are shared across the local papers domains; but don’t quote me on that.



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