Public Watchdog.org

“I’d Rather Persuade 8 Than 8,000”

04.29.14

Those words were spoken by then-city manager Tim Schuenke a little over a decade ago when he was telling the then-Library board and staff how they could get a new library as part of the Uptown TIF.

The “8” represented a majority of the City Council back then.  The “8,000” was a convenient symbol for the number of voters it might take to win a referendum.

Back then the Council had 14 members – 2 from each ward – before master manipulator Howard Frimark was elected mayor and decided to go Schuenke one better.  Frimark sponsored and passed a referendum in November 2006 to cut the Council from 14 to 7.

Because, of course, it’s easier to convince (and elect) 4 than it is to elect and convince 8.  And with the “right” 4, you can pretty much tell the 8,000 to pound sand.

The relevance of Schuenke’s pithy statement comes to mind now that two referendums are being discussed.

One of those is for an increased tax levy targeted to providing more money on an annual basis for the Park Ridge Library to replace the extra funding – above and beyond the base funding prescribed by Illinois law – the City used to voluntarily give the Library back when “tax, borrow and spend” was the unofficial motto of City government.

The other is for a multi-million dollar bond issue to pay for the cost of flood remediation for 2-3 distinct sections of the City.

Those who want to take more out of government than they pay in didn’t mind a bit when the City was deficit spending to the point where its General (operating) Fund balance dropped so low that occasionally money to cover the City’s payroll had to be borrowed from one of the City’s enterprise funds, like the Sewer Fund or the Water Fund.  Nor did they care all that much, if at all, that such reckless management, along with the Uptown TIF debt, was leading to the downgrading of the City’s credit rating that continues to this day – as noted in City Finance Director Ken Oliven’s April 11, 2014 TIF Update Memorandum:

“The Uptown TIF obligations caused the City’s debt rating to be both downgraded and put on negative outlook in 2012.  This increased City borrowing costs for debt issued that year.”

Notably, Oliven’s memo goes on to quote a Moody’s rating report that “[a]lthough management is implementing the necessary policies to balance the TIF operations and rebuild General Fund liquidity, the positive results have yet to be demonstrated in audited results.”  That’s a pointed reference to the efforts Mayor Dave Schmidt and the Council have made to reduce spending while keeping annual tax increases in the moderate 3-4% range.

But Moody’s goes on to warn that “[i]f actual operating results in fiscal 2013, 2014 and 2015 negatively deviate from current expectations by a significant magnitude, the city’s credit rating will likely face downward pressure.”

That means higher borrowing costs for the City, especially if/when it issues the tens of millions of dollars of bonds it will need to pay for the flood control projects currently being debated.  And which should go to referendum.

Not surprisingly, these kinds of ominous warnings from bond rating agencies don’t faze the folks who think their own particular one-trick ponies are entitled to special funding treatment by the taxpayers.  They know that their best chance for getting such special treatment is convincing 4 of the 7 people sitting around The Horseshoe at City Hall instead of having to go to referendum and convince 8,000 voters– as they might need to do for any referendum issue on the November general election ballot.

Like the referendum the City Council gave a preliminary green light to at last night’s City Council COW (Committee Of the Whole) meeting.

The basic concept of going to referendum for a separate Library tax levy increase was approved by a vote of 5 (Alds. Milissis, Shubert, Knight, Mazzuca and Maloney) to 2 (Alds. Sweeney and Smith).  Nevertheless, the idea of a binding referendum rather than a merely advisory one passed unanimously.  And going to referendum this November passed 6-1, with Ald. Smith voting “no.”

That decision, having passed through the COW, still has to be approved by the full Council on two readings.  Meanwhile, the actual text of the referendum question and the dollar amount of the levy increase will need to be determined.

That’s a blow for the Library Staff and a majority of the Library Board who didn’t want a referendum of any kind.  They had hoped to pressure at least 4 aldermen into handing over an extra half-million dollars or more a year of unmarked City funds than to ask the taxpayers directly for those funds earmarked expressly for the Library.  That way, they never would have to find out by actual vote count how many taxpayers really wanted the Library to get all the funds the Staff and Board majority insist they do.

But if a referendum couldn’t be avoided, they preferred the April ballot to November’s.

Because they’d rather persuade 4,000 voters in April than 8,000 in November.

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