Budget Chief Clerkin introduces deficit “action plan” to lawmakers.
Paul Bass Photos
A downtown parking lot and recent secret home to the city’s narcotics squad can be yours — especially if you want to put a new building there and pay enough money to help the city dig out of a budget deficit.
The lot and building in question sit at 10 Wall St. between Orange and State streets.
The city is preparing to put the 1.062-acre property — a surface parking lot and a maintenance garage with offices that until earlier this year housed the police department’s tactical narcotics unit — on the market as part of a broader emergency “action plan” to tackle a budget deficit that could reach as high as an estimated $11 million before the fiscal year ends next June 30.
City Budget Director Joe Clerkin offered a preview of that still-emerging “action plan” to aldermen at a City Hall hearing last week. Members of the board’s Finance Committee asked his office to come up with the plan rather than wait until late in the fiscal year. Lawmakers hope to avoid the situation they found themselves in last year when they suddenly had to deal with a budget deficit just a few months before the fiscal year’s end. (Read about that here.) They hope to make thoughtful choices about budget cuts and about selling city-owned property, and to avoid having to rush a last-minute sale that produces too little money or trades New Haven’s long-term interest in return for plugging a one-time budget hole.
First Step: A Deep Freeze
Cameron (right) with fellow FRAC-ers Donarell Elder (left) & Joe Dolan (center).
Clerkin spoke after David Cameron offered the aldermen a sobering assessment. Cameron, a Yale political scientist, heads the city’s Financial Review and Audit Commission, which offers a monthly independent assessment of the state of New Haven government’s finances. The latest report shows that New Haven is on course to run a deficit of between $2.5 million and $11 million by June 30, Cameron reported.
While they hadn’t heard quite so high numbers before, the aldermen had already learned a month earlier about the existence of a looming deficit.
That was an urgent prospect for several reasons: The city has for the most part run out of reserve money in its “rainy day fund” to cover any deficit above $1.86 million, it has failed to settle most union contracts and produce expected labor savings, Yale has held off on building two new residential colleges (which produce permit fees for the city), state PILOT (payments in lieu of taxes) money is less than expected, and police and fire overtime are running over-budget.
Hence the request for Clerkin to begin drawing up the action plan.
It’s still a work in progress, Clerkin reported. He said the city’s chief administrative officer will report on the efforts to rein in on overtime at the next Finance Committee meeting, for instance. But the plan has some specific ideas in place and is already producing results, said Clerkin (who elaborated in a subsequent interview this week):
• The city put a freeze on filling some (not all) vacant positions. That would save $839,382 over the course of a year, he calculated. Some of those positions — especially those that produce revenue — will eventually be filled. But many will remain unfilled. For instance, his Finance Department has chosen not to replace a chief financial administrator position that opened after a retirement last year, or to fill a technology project leader position or the supervisor position Clerkin held before becoming budget director. Staffers are simply taking on more responsibilities to fill the gaps, he said.
• The city has put a freeze on money departments were supposed to have spent so far, but haven’t. That has saved $1,210,306 so far this fiscal year. Again, some of that money will be un-frozen later if department heads demonstrate a pressing need. But most won’t, Clerkin said, and the freeze will remain in place, producing more savings. The biggest savings, $347,500 worth, have come from Clerkin’s own Finance Department. He said the savings include “a whole bunch of small things,” from telephone costs ($15,000) to $32,000 in unpurchased office supplies, like toner requested by the IT department. “We’ll give up some of it” altogether while seeking to save money on others, he said of the previously budgeted purchases.
• Yale-New Haven Hospital will be asked to increase its annual voluntary contribution to the city by $1.6 million in the wake of its takeover of the Hospital of St. Raphael. No word on those efforts yet. Fingers will be kept crossed — as they will for the fate on negotiations with close to a dozen municipal unions working under expired contracts.
• Another “bond sweep.” Officials will reexamine old capital projects to see what bonding money the city already borrowed never got used. This isn’t a new idea; “every year we whittle at it,” Clerkin said. So he doesn’t expect the idea to save more than $500,000.
• The city will sell 10 Wall St.
Mid-Block, The Sequel
The city doesn’t yet have a figure for what it expects to make from that sale. The property is assessed at $931,770. Livable City Initiative (LCI) Director Erik Johnson cautioned against drawing any initial conclusions about the eventual sales price; his office hasn’t yet done an appraisal or learned if the property has environmental problems needing a clean-up.
The city bought the property in 2006 from the phone company, which used it for a maintenance shop and a store to sell phones and accept customers’ bill payments. The city planned to turn the property over to the builder of a $24 million 600-space “Mid-Block Garage”, but that plan eventually died.
Officials continued to envision building up that property. In the meantime the parking authority has used the surface lot to rent out about 100 spaces and the bulk of the small building to store plows and other equipment. Until this past spring the police rented the now-empty offices for its narcotics squad, which new Chief Dean Esserman moved to headquarters and reconfigured. The city plans to tear the building down. The parking authority will be able to find space elsewhere for the equipment and spots in the Temple and Crown Street garages, according to Executive Director William Kilpatrick.
Now the city hopes that a builder will take advantage of the hot downtown housing market and add to the tax rolls with a project that includes some housing at 10 Wall St., said development chief Kelly Murphy, though she’s open to a range of possible uses. The idea isn’t to sell property just for a one-time revenue fix, she said, but rather to build the tax base as part of a broader long-range design.