Elorza reorganizing fire department to save money

THE MAYOR'S office hired Public Financial Management Group to study the city's long-term financial challenges. It found that that the projected deficit in fiscal 2021 is $19.1 million. / COURTESY MAYOR'S OFFICE/PUBLIC FINANCIAL MANAGEMENT GROUP
THE MAYOR'S office hired Public Financial Management Group to study the city's long-term financial challenges. It found that that the projected deficit in fiscal 2021 is $19.1 million. / COURTESY MAYOR'S OFFICE/PUBLIC FINANCIAL MANAGEMENT GROUP

PROVIDENCE – Mayor Jorge O. Elorza is reorganizing the Fire Department in an effort to save money and deal with the city’s financial challenges.
Elorza announced the plan on Thursday after he unveiled a report the city commissioned by PFM Group that showed continued structural deficits if the city continues on its current course.

Elorza and Public Safety Commissioner Stephen Paré are immediately reorganizing the Fire Department from four platoons to three with a condensed shift schedule. The change is expected to save as much as $5 million annually beginning in fiscal 2017 without compromising safety, a news release from Elorza’s office said.

The report, which looked at fiscal 2017 through fiscal 2021, includes a baseline forecast and financial projections for the city. In fiscal 2021, the projected deficit is $19.1 million, while the cumulative deficit is projected at $85.4 million.
“The report is in, and it shows us that Providence still has a structural deficit in the range of $11 to $19 million a year and that gap will continue to widen if we do not begin to immediately address the problem,” Elorza said in a statement. “We need to fix the structural budget imbalances that stand in the way of lasting fiscal strength instead of just kicking the can down the road and letting the problem grow worse.”

The report showed an annual shortfall of $11.5 million in fiscal 2017, which grows to $13.5 million in fiscal 2018 and $17.2 million in fiscal 2019, before dropping to $15.4 million in fiscal 2020 due to revaluations increasing revenue and climbing again to $19.1 million in fiscal 2021.
“Escalating pension and health care costs, the loss of tens of millions in state aid and little tax revenue growth are among the factors that drive the city’s projected deficit over the next five years and beyond,” a news release from Elorza’s office said.

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Elorza, in the release, said his proposed budget for fiscal 2016 begins to address the city’s underlying structural deficit with $2 million in annual revenue from expanded parking meters and fees as well as a $6.5 million deficit reduction through growth in the property values.

The administration will also work with the Providence School Board to start transforming the school department’s central office, which it described as having an “outdated staffing model” and “is failing to meet the needs of families and schools.”

“Change is never easy and addressing Providence’s fiscal challenges will require innovative solutions,” Elorza said. “But I am committed to doing whatever it takes to provide a firm foundation for our city, and I am confident that Providence’s stakeholders are up to the challenge.”

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