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    Sedona.Biz – The Voice of Sedona and The Verde ValleySedona.Biz – The Voice of Sedona and The Verde Valley
    Home » Letter to The Editor: City of Cottonwood’s Fiscal Deficit
    Letter to The Editor

    Letter to The Editor:
    City of Cottonwood’s Fiscal Deficit

    February 20, 2018No Comments
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    logo_lettereditorBy Sherry Twamley, Verde Villages Resident
    (February 20, 2018)

    The big topic of the day is not about saving the Cottonwood Recreation Center for pickleball players, it is about the City of Cottonwood’s fiscal deficit.

    On February 13, 2018 the City held a budget work session.  To address a projected fiscal deficit, the Council agreed to explore a sales tax increase; fees; consolidating services; getting outside agencies to be more competitive when asking for financial support; and merit levels for employees to address a fiscal budget shortage. 

    There was a glaring omission: How much money does the City really need to resolve its revenue crisis? How short is the City?  Is it $1 million, $3 million or $10 million?

    The problem is: the City Council’s focus on small things mentioned at the February 13, 2018 work session are red flags and indicate a lack of in-depth knowledge about the budget planning processes, lack of clarity and purpose in setting forth the critical objectives of the planning process, and point to a lack of understanding about the much longer-term impacts of the decisions made in the budget planning meeting for the future of the City. 

    The City clearly needs a much more rigorous course of action led by a professional financial advisor to chart the City’s fiscal course accurately, identify opportunities for a turnaround; to budget wisely for now and for the future. The timing is right for the city to re-chart its course and to adopt a much more professional, rigorous approach to their long-term budget planning. 

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    This is critical because the budget is the single most important document that the City produces each year, and it receives close public scrutiny. It serves as both a financial plan and a policy document, that is, a description of the policies the city intends to pursue in the future. These decisions will impact the city’s fiscal and economic security that will last long beyond the budget year and yet, the city is only focused on short term decisions — not the longer-term consequences. 

    Long term, the fiscal policies must be analyzed on a monthly basis rather than annually, to make corrections when necessary and ensure the city stays within its budget.   At the top of the list should be personnel cost containment.  In fiscal year 2018, Cottonwood’s personnel costs exploded to almost $20 million, according to the city’s 2018 annual budget.

    SOLUTIONS

    • Create a map for the future. The budget and accompanying documents should include a detailed road map of the budget’s immediate and future impacts on the city’s fiscal health.
    • Professional and credible estimates (“what if scenarios”).
    • Standards and oversight to guarantee that these analyses of the budget’s impacts are professional, credible and prepared — without political influence.
    • Ways to stay on course.
    • Mechanisms should be put in place to trigger any needed changes during the budget year before too much damage is done. 

    My message to Cottonwood is, it is never to late to get professional help. The root of the problem was not a lack of revenues. It was how the City recklessly borrowed and spent public monies irresponsibly that led to the fiscal deficit. Personnel cost containment should be at the top of the “hit list” for financial recovery.

    Comments are closed.


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