Amid threats of cuts, economist puts Calexico’s public funds under microscope

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Economist Dr. Peter Donahue claims Calexico’s budget crisis is a “deficit by design” during a town hall meeting Feb. 28 organized by Calexico residents and fire fighters.

 CALEXICO —  In response to reports of shutting down one of the city’s fire stations, the people of Calexico organized a town hall meeting Feb. 28 and gathered at William Moreno Jr. High School in efforts to save the fire station on the west side of town. City officials recently informed the fire department that they will be laying off six fire fighters and shutting down Fire Station #2 completely. 

Economist Dr. Peter Donahue was acquired by the Fire Fighters Association to obtain financial information directly from the Calexico financial records in order to assess the numbers.

“We have to come together as a community to demand that the city not move forward with terminating six vital positions that save lives in our community and an entire fire station that has provided services not only to the west side, but to the entire city of Calexico,” said Letty Zuno, a  Calexico resident.

“We were not able to get onto the city council agenda,” Zuno explained. “Several requests were rejected by the city council and we would like to have that request rescinded. We, as a people, would like to be heard.  Our elected officials come knock on our doors and ask for our votes. They have power through our votes.  And we bestow that power and trust in our elected officials to act, to behave, and to make decisions that affect our wellbeing – that improve the quality of our life and improve the community that we live in, not to subtract from what very little we already have,” said Zuno.   

Dr. Donahue conducted a slide show presentation which showcased financial results based off the numbers from the 2010-2011 fiscal year to Calexico’s last comprehensive Annual Financial Report from 2014-2015.

“If the city is making the claim that it is in financial distress, then they should provide sworn numbers to the citizens and businesses so that they can analyze those numbers to assess whether they are true or not,” Donahue said. “Those numbers have still not been provided. The only legitimate numbers we have to work with are over 21 months old. The city only said that it ‘somehow cannot afford to pay fire fighters and that it simply somehow cannot afford to maintain a fire station,’” said Donahue.

Donahue’s presentation focused on public funds.

 “We hear a lot of rhetoric and talk about fixing the budget and we don’t see that happen with this particular topic we are discussing here today,” stated Zuna.

According to Donahue’s findings, the general fund expenditures have been under budget by $0.4 million since the 2010-2011 fiscal year up until 2014-2015.   

Of the five expenditures by function categories of general government, police, community development, public works and fire department, the fire department was the only agency that stayed under budget, saving $400,000, he claimed.

According to Donahue, from 2013 to 2015, community development spending was over budget by roughly $1.4 million, and public works spending went over budget by 15 percent, or $220,000, in 2014-2015.

The city of Calexico transferred out $1.1 million of general fund money to other funds for the year 2014-2015, which in turn created a $125,000 general fund deficit, he said.

“The city claims the Inability to pay, due to financial distress, but facts like this make it hard to endorse the idea that they are in financial distress. This appears to be a genuinely engineered and created crisis or a ‘deficit by design,’” said Donahue.

In 2014-2015, the city recorded $2.6 million in business-type unrestricted net assets and $24.2 million in all funds, unrestricted net assets. According to reports, it takes roughly $400,000 to keep the fire department open.

“Folks, I can’t buy the idea that a city whose last financial report, sworn document, showed results like this.  I can’t buy the sell that they can’t afford a fire station and (to) keep all your fire fighters working,” said Donahue.