Woonsocket budget showdown

March 26, 2012

WOONSOCKET – More than 500 residents packed into Hamlet Middle School last night to decry the supplemental tax increase city officials have proposed as a partial solution to a cash crunch that’s rushing toward the city like a freight train.
At least two dozen residents and small business owners approached a microphone to address the City Council, seated on a stage in the cafetorium, as of press time, when the gripe session was still going on. Many expressed anger and distrust for city officials, and at least one man said certain ones, past and present, should be subject to a criminal probe for causing problems in the School Department that have been widely blamed for the crisis.
Raising his voice, John Reynolds Jr. said former Schools Supt. Robert Gerardi, suspended School Department Business Manager Stacey Busby and former Mayor Susan D. Menard should all be subpoenaed to answer questions about the causes of the financial meltdown. Then he looked up at members of the City Council, and stared directly at Councilman Marc Dubois.
“You too,” he said to Dubois, the former chairman of the School Committee.
The council is scheduled to act on a proposed supplemental tax April 2 that’s designed to raise some $4.3 million. The move would only go part-way toward closing a hole in the School Department’s budget that’s grown to $10 million, despite Busby’s predictions of a surplus in late 2011.
It has since come to light that Busby had an ironclad, no-termination clause in her contract which no one serving on the school committee at the time the pact was approved seems to know anything about. Recently, Dubois said publicly that that the contract must have been altered after he reviewed it, and members of the School Committee are poised to ask the State Police for an investigation tomorrow night.
Recriminations aside, the Fontaine adminstration says the city may run out of cash by the first week of April, forcing the city into bankruptcy, without a comprehensive plan of raising revenue, borrowing in anticipation of collecting supplemental taxes, and cutting costs to bridge the budget chasm. The supplemental tax bill alone, calling for a 13 percent increase over current rates, would be $3.13 per thousand on residential property. That means the owner of a home worth $100,000 would pay an unplanned $313 more this year, while business properties and motor vehicles would be slapped with even higher rates.
Reynolds wasn’t the only one looking for accountability from the School Department last night.
“We don’t know what happened,” said David Parenteau. “But it would be nice if someone who worked in that particular realm came out and said, ‘Hey, I screwed up.’”
The crowd was so packed for the gripe session that it had to be split up into two groups. About 300 squeezed into the cafetorium, while about 250 more were steered into the gymnasium, watching on a big overhead screen. At the outset, Council President John Ward advised spectators that it was their turn to talk — councilors were just there to listen. The mayor and Finance Director Tom Bruce were also on hand to answer questions, if necessary.
At various points during the feedback session, teachers were both attacked and defended. Some speakers decried the erosion of the city’s tax base, saying comparatively few property owners and businesses support a larger population of lower-income renters with children in school. And, in a refrain that continues to hold traction despite official efforts to drown it out, some said bankruptcy may be preferable to the city’s plan of cuts and supplemental taxes.
Alethia Forcier said she no longer has any trust that the fix proposed by city officials will put an end to the seemingly endless cycle of tax hikes and fiscal crises.
“How do I know you’re not going to come back at me again next year?” she said. Forcier said she knows bankruptcy is supposed to be a negative path, one that might depress crashed housing prices even more, but so what? “They’re already down anyway. It’s not going to cause that much harm.”
Phil Labrecque, an unsuccessful candidate for City Council during the last election, said he’s heard people say CVS, the city’s largest employer, will pack up and leave the city even worse off in response to a bankruptcy.
But Labrecque argued just the opposite. As a small business owner, he’d feel more comfortable knowing a bankruptcy filing had contributed to a more stable, equitable tax structure in the city, and he thinks CVS would feel the same.
“I would think a place like CVS would embrace a stable tax in the future,” he said.
Several people portrayed the property tax as an inequitable form of taxation, particularly in a city where a disproportionate number of residents live in rental property. The solution, they said, was a tax on everyone who lives in the city, whether they own property or not.
“Charge the renters something, especially if they have children in schools,” said Charles Souder.
Susan Paulina said the supplemental tax bill is the price city residents must now pay for the invisible wall that exists between municipal and school departments. Saying, “We need to change the way we do business with ourselves,” Paulina added, “We continue to act like we’re a divorced family who get can’t along. The taxpayers are the divorced children who feel the fallout from that.”
Jeanne Budnick, a city resident and owner of Pepin Lumber, was with the crowd saying more cuts are the cure for the city’s fiscal woes, starting with teachers' salaries. It’s a fallacy, she said, that teachers haven’t gotten raises, because a teacher at “step five” of the union contract is actually getting a six percent pay increase each year. “Step 10,” she declared, “that’s even sicker.”
But Sharon Knettell, the first speaker of the evening, said it’s short-sighted to blame teachers. She said the solution is to raise taxes fairly, not just by “nickel-and-diming hairdressers and restaurants,” but by going after “the wealthy.”
“The common mantra is, ‘Oh, they’ll leave,’” she said. “Good.”