PITTSFIELD - A state-controlled Financial Advisory Board, created by special legislation three years ago when the city was in the depths of a fiscal crisis, is expected to approve a $102-million city budget tomorrow and dissolve.
The fiscal 2005 budget was crafted and approved by city officials. The spending plan, the city's second consecutive balanced budget, provides for the efficient delivery of city services and demonstrates that the fundamental objective of the special legislation, fiscal stability, has been achieved.
"This financial advisory board is another example of state and local governments working together to solve complex problems," said Gerard D. Perry, acting deputy commissioner for Local Services, a division of the Department of Revenue.
In the spring of 2001, city officials faced a budget deficit estimated at about $8 million and growing. A number of fiscal issues, including problems with the city's health insurance fund and the administration of school construction debt, contributed to the deficit.
City and state officials worked together on a home rule petition that was approved by the Legislature and signed by then Governor Jane M. Swift on July 3, 2001. The law allowed Pittsfield to borrow up to $10 million to avoid making drastic cuts in operations and workforce.
The city actually borrowed $4.6 million under the law and repaid the loan during fiscal 2004.
The Finance Advisory Board, also created as part of the law, assisted in implementing changes to secure the long-term financial stability of the city. The city's annual budget, all appropriations, expenditures and borrowings were subject to the approval of the Finance Advisory Board, which consisted of the Mayor, the President of the City Council, the Secretary of Administration and Finance, the Commissioner of Revenue, and the Deputy Commissioner of the Division of Local Services, or their designees.
While the board was working with Pittsfield, the city has been able to reform the administration of its health insurance programs, bring consistency and equity to the city's relationship with its workforce, eliminate the use of one time revenues to fund the annual operating budget, develop reasonable revenue and expenditure budgets and reconcile its cash and receivables.