Why is Erie County in such a financial quagmire?
There are the usual suspects: Poor county executive leadership, a gang of couldn't-shoot-straight legislators, property tax cuts without commensurate spending reductions, huge state-imposed local tax burdens and costly union contracts whose benefits built up during more flush times.
All are part, indeed, of the persistent mess. But if there's one inexcusable, but seldom discussed, aspect to put a finger on, it's that Erie County spent $850 million in one-shot revenues, money gained through the sale of future assets and increased borrowing since 1999.
The premise of government is simple: Provide services taxpayers need at a cost they are willing to pay and balance the budget. If it's out of balance, cut spending, or raise taxes -- and be willing to face the political consequences of either.
According to state Comptroller Alan G. Hevesi and Anthony Armstrong, manager of public policy for the Buffalo Niagara Partnership, here's what the county did after cutting property taxes 30 percent and encountering its woeful balance sheet:
Spent all accumulated surpluses, totaling $202 million; used $59.6 million in money borrowed against its share of the national tobacco liability settlement to pay debt service; spent $127.5 million in tobacco money on capital projects, some of them questionable; spent $85 million from the sale of Erie County Medical Center (in return for debt service costing county taxpayers $214 million through 2034); took on $182 million in increased debt; added another $40 million in short-term borrowing, interest and fees; made another $100 million in further tobacco securitization; and borrowed $52 million more in July 2005.
That $848.1 million is now gone, with nothing dramatically different in county operations to show for it, except new debt payments and a few capital improvements. This is why Erie County needs a debt diet. Further, those routes are all but closed now. The county has no reserves, few borrowing options and should be ashamed to try more one-shots. It's pay-back time in Erie County.
This is an indictment. It should once and for all show Erie County taxpayers that their so-called leaders avoided reform, took the easy way out and left taxpayers to foot the bills at nearly every turn. This mess didn't come to Erie County from the outside.
This administration and Legislature faced structurally imbalanced budgets after making a political decision to cut property taxes 30 percent. That means government services cost millions more than revenues could pay for, year after year after year. What did they expect would happen? Instead of cutting services or focusing on costs that were out of line, the Giambra administration filled holes with reserve money, excessive borrowing and ill-advised one shots.
County Executive Joel A. Giambra defends the decisions, saying no county in New York was able to keep pace with increasing costs of pensions, Medicaid and state mandates over that time.
"We couldn't make changes fast enough," he said.
He added that if people think they can "fix" Erie County, let them sit in his chair and discover that's nearly impossible.
Unfortunately, there's no reason to believe either the county's elected officials or the county control board will take this indictment seriously. But they absolutely should. Time for a new day in Erie County government.