PROVIDENCE – Three-quarters of the way into the fiscal 2021 year, Providence is finally poised to pass a full spending plan.
The $511 million budget passed by the Providence City Council Committee on Finance Wednesday represents a $4.1 million net increase over the original, $506.8 million plan set forth by Mayor Jorge O. Elorza last spring. Exactly what was changed was only made publicly available Thursday morning, following the committee’s 3-0 vote.
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Councilwoman Helen Anthony abstained from the vote, citing the “flawed” process in which she only received the amended version hours into the meeting. She also noted that the public had not seen, nor had an opportunity to weigh in on, the amended version of the budget.
The three-page document published on the city website Thursday details specific costs and revenues that have changed in the year since Elorza first introduced his spending plan.
As anticipated, the city lost more than $6 million in departmental revenue due to lower collections in court fines and fees, parking meters and other sources as a result of the pandemic. However, these losses were offset by $26.5 million federal coronavirus relief funds, as well as a 94% collection rate in local taxes expected by the end of the fiscal year, Lawrence J. Mancini, the city’s chief financial officer, told the committee on Wednesday.
On the expense side, the city shaved more nearly $2 million off its class A salaries thanks to attrition, and filling only essential open positions, Mancini said.
However, overtime expenses for police and fire added more than $4 million over the original spending plan. There was also a $1 million addition for heat, light and power costs due to delayed billing and inaccuracy in prior budget estimates, Mancini said.
The newly approved four-year police union contract also added nearly $2.8 million in expenses including retroactive payments for increased wages set under the agreement.
The spending plan also includes the full $73.5 million payment to the city’s pension plan, as well a small, $100,000 transfer to the city’s rainy day fund, as recommended by city legal staff to meet mandated balance requirements, Mancini said.
None of the existing $14.9 million balance in the rainy day fund was used to balance the budget.
A full spending plan is typically approved prior to the July 1 start date, but due to uncertainty caused by COVID-19, the city instead opted to only pass a tax levy setting tax rates for the year which kept all taxes at the prior, fiscal 2020 rates. At the time, the city was awaiting determination on state aid to shape its own spending plan.
Also unchanged is Elorza’s original $130 million allocation for the Providence Public School District, which is under state control.
The amended spending plan now heads to the full City Council for final approval, although a date for their vote has not been set.
Finance Committee Chairman John J. Igliozzi Jr. in a statement after the meeting praised the work of the council and administration’s finance teams who “worked tirelessly to make sure that the focus remained on the residents and our businesses and that we would be able to pass a responsible and fiscally prudent budget.”
The city is expected to unveil a proposed fiscal 2022 spending plan later this month, Mancini said.
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
