City spending us into bankruptcy

Published 12:00 am Tuesday, January 30, 2007

To the Editor:

I am forwarding this letter to my city council colleagues and asking The Times-Journal to print it in order to alert Selma’s taxpayers.

We are spending the city’s General Fund into bankruptcy. Please consider the following facts based on information for the first quarter (25 percent) of this fiscal year. Sales tax revenues make up 63 percent ($11,195,560 of the $17,746,326 total) of our General Fund Budget. Sales tax revenues for the first quarter (October-November-December) of this fiscal year are down $189,783.00 from the same period last year.

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Unfortunately, the Mayor projected and we approved a $219,500 (from $10,976,000 to $11,195,500) projected increase in sales tax revenues for this fiscal year.

If the first quarter deficit of sales tax revenues of $189,783 continues for four quarters of this year plus the projected $219,500 increase, there will be a $978,632 deficit for this year.

This deficit will wreck the General Fund Budget for the fiscal year ending Sept. 30, 2007. Despite this bleak sales tax outlook, we continue to approve, almost without any questions, every expenditure the Mayor presents to the Council.

The Lodging Tax revenue is down $29,464 for the first quarter of this fiscal year. The Mayor projected and we approved a $63,000 surplus in the lodging tax revenue this year; however, if the first quarter trend continues, the Lodging Tax Fund will have a $54,856 deficit ($117,856-$63,000) for the year. Nevertheless, the Mayor continues to propose and we continue to approve expenditures from the phantom lodging tax unappropriated surplus.

If you personally were going to borrow $350,000, wouldn’t you ask more than one lending institution for rates and terms? A rational person would get the lowest interest rate and best terms. However, Mayor Perkins got only one proposal for his $350,000 Warrant Issue.

Although he would not answer reasonable questions Monday night about when the money had to be paid back or how the city planned to pay it back, he must know that issuing warrants, rather than paying for vehicles and equipment out of the General Fund Budget, is a sure sign that financial trouble exists in the General Fund.

Although 25 percent of the fiscal year has past, the city’s General Fund has received only 22 percent of this year’s projected revenues. This equates to a deficit of $556,000 for this quarter. If this trend continues throughout the year, we will have a 12 percent or $2,224,000 deficit in our General Fund revenues. This will effectively bankrupt the city’s general operating fund. Monday night, we spent money from a non-existent unappropriated surplus in the General Fund and from a phantom surplus in the Lodging Tax Fund.

Additionally, no one has yet explained how we will repay the $350,000 Warrant Issue which appears to be due on May 1 or how we will we pay the $310,000 judgment against the city as a result of our inept case against Sanders, et, al. or the legal fees resulting from the appeal of that case as well as legal fees from the suit the city instituted against Dallas County. Our insurance does not cover any of these costs. The money to repay the warrant, the judgment and to pay all of these legal fees is not in our largest in the history of the city of Selma General Fund Budget for this year.

I ask you, my council colleagues, to carefully consider these facts and to act responsibly as the Mayor and his department heads continue to present these unbudgeted and over budgeted expenditures to us meeting after meeting. The Mayor’s re-engineering strategies of two years ago did not work and neither will whistling “Dixie” work as we spend money we do not have on projects we do not need. A day of financial reckoning is coming to city government-sooner rather than later!

Cecil Williamson

Councilman Ward 1