May 16, 2011 by USA Post
Rahm Emanuel, The mayor-elect Rahm Emanuel plans to begin to curb the spending habits of the city as soon as he takes office on Monday. The “Day One”, which was frozen in almost everything except checks and bills coming due. That will help keep its promise to reduce and $ 75 million budget last Mayor Richard Daley.
Emanuel financial gurus have been working for weeks on a list of other options to reduce, but will not make final decisions until they are in the office and get a closer look at the books of the City Council. They have given themselves a period of 60 days.
Budget experts, who long has said the city must stop spending more than they have inside, we applaud the immediate cuts. But, like Emanuel, who say it is a mere down payment on a more vexing problem.
“That’s a wonderful signal to be sent to take seriously, but only goes so far,” said the inspector general Joseph Ferguson, who as internal oversight body of the city has increasingly focused on economics. “(The budget) is the first order of business, and will be the first order of business for quite some time.”
Daley administration pegs deficit next year and 587 million, but the camp of Emanuel think is probably worse than that. The year is half over, and the mayor’s current budget projection is based on concessions that the unions have not accepted. Not include the cost of one and 30 million court ruling Friday in a case involving firefighters. Other financial landmines abound.
In total, the budget provides a fifth hole of the day-to-day expenses of the city. And that does not include dramatic increases in pension contributions Emanuel will have to start doing during his first term. That could mean an additional 500 million or more annually.
Emanuel recently recognized how big is the problem. “You need two pillows to sleep at night,” said in announcing the formation of his economic council.
In another sign of its intention to begin to wrap their arms around the budget, the incoming mayor has called for a cut of 10 percent of payroll for the management of the city, a move that could save and 7 million a year. He has worked a deal with the city to reduce the number of committees to save about 470,000 and a year. And it is the merger of departments, a step that will lead to layoffs.
Reduce the number of city workers have to be part of the equation, because the salaries and benefits make up over 80 percent of spending by the city every day, “said Laurence Msall, president of the Civic Federation, a group of nonpartisan budgetary surveillance.
“It is difficult to see how the city will close a gap … without reducing the payroll,” said Msall.
In the long term, Emanuel has offered general ideas on how to get a grip on spending that could shape the 2012 budget will have to fashion before the end of this year.
Has been careful to go into too much detail. It would be churlish to be harshly critical of Daley, his old political ally and friend. And the deposit of your hand could give unions and council members are reluctant to return for more time to plan their opposition.
Emanuel has not taken much of the table, except for a tax increase. He also said he wants to sell Midway Airport to a private operator to generate a windfall in advance.
These solutions only once in the paper on the budget deficit are the reasons why Daley is leaving Emanuel as major challenge money. Also one of the reasons: A bad economy has resulted in the participation of the city of sales, transfer taxes real estate, rentals, hotels and attractions as a whole fell by an average of more and 250 million per year since 2007.
But manyanlysts say the budget Daley and aldermen have also spent the greater part of the problem caused by union contracts to long-term locked-in raises, rising health care costs for workers and increased lending brought higher interest payments.
Critics point out that even in 2007, when the economy reached its peak, the city faces a budget deficit of 95 million, and spending has only increased since then. Even a robust economic recovery “will not close the budget deficit,” said Msall.
Besides cutting jobs, Emanuel will have to find other ways to save money. Although it has rejected an agreement for Midway, which has not closed the door to privatization, but has called for stricter standards for evaluating such agreements.
Prosecutor Alexandra Holt, director of budget Emanuel has represented companies that deals with the government’s privatization, and Lois Scott, the new chief financial officer, was also involved in these activities in the private sector.
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