Tuesday, October 4, 2011

Fairview Fire District Commissioners Approve Flawed Budget Document

I considered an alternate title for this post: “Fairview Fire District Treasurer Presents Flawed Budget Document”  Both titles are accurate.  But the commissioners actions indicate they wish to take some of the blame for embarrassing the Fairview Fire District.

On September 26, 2011, Fairview Fire District Treasurer James Passikoff presented a proposed budget document to the board of fire commissioners at a budget workshop meeting, and it was approved unanimously by the commissioners with little comment.  This budget document contains so many flaws, it's hard to know where to start.  If this is sounding like yet another rant against Passikoff, well, that's really only half true.  When it comes to the fiscal aspects of the Fairview Fire District, when it comes to following Fairview's budgetary money, when it comes to understanding the financial facts of Fairview, my view is that Passikoff is the smartest guy in the room.  To some extent, that's as it should be.  The problem is that the standard for smartness that is acceptable to Fairview's board of fire commissioners is so low that Passikoff can present just about anything, it seems, and the board will uncritically accept it. 

Officials Don't Understand Fairview Fire Tax Issues

As I see it, Passikoff has a great depth of knowledge concerning many fire district fiscal issues.  Unfortunately, when it comes to property tax issues, Passikoff has repeatedly demonstrated that he does not grasp some essential facts about assessed value and equalization rate.  See here.  More unfortunately, he has not shown an interest in correcting this weakness.  Even more unfortunately, Fairview's board has shown itself indifferent to whether the budget numbers presented to the public — or to themselves — make any sense.

Garbage in Budget Document

To find flaws, one need look no further than the first line of numbers on the first page of the proposed budget document.  This line, purporting to show a change in Fairview's “assessed property valuation” is all meaningless garbage.  Similar garbage is shown on the “Total Assessed Valuation” line on the next to last page.  This garbage is an exact repeat from the budget projections spreadsheet presented at the May 26 public workshop meeting. The reason this is garbage is explained in detail here.  I sent essentially the same explanation to Passikoff, Commissioner Bob Gephard, and Commissioner Joe Petito on May 24.  I received no effective response from any of them, despite months of making myself annoying.  Apparently they are all indifferent at best about understanding, correcting, or even repeating this blunder.

Contradictions in Budget Document

The last two pages of the budget document contain data about 2012 assessed value and 2012 proposed tax rate.  Each page contains numbers for both assessed value and tax rate, but the numbers do not agree with each other.  So which is right?  I wrote here that the first set is right.  Silly me!  It turns out that both sets are wrong!  (For details, see my 9/29/2011 comment appended to that blog post.)  It's not just a couple of misprints.  All the numbers derived from the wrong numbers are wrong too.  That's right, the Treasurer presented, and the commissioners passed, a budget with two contradictory tax rates — and both are wrong.

The treasurer didn't look at this beforehand?  None of the commissioners looked at this beforehand?  Or is it that the tax rate — the rate at which property owners' wealth is taxed — doesn't really matter?  One thing is obvious:  The commissioners had no idea what the proposed 2012 tax rate really was when they approved the budget.  This is more than a little disturbing.  It shows a board that has no hand on the wheel.  The board doesn't even know there is a wheel.

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