As many Contra Costa residents are well aware, the county fire departments have absorbed ambulance services – previously provided by private operators at a lower cost to taxpayers – to pad their already bloated pensions since 2016. What many residents probably don’t know, is that 60 to 80 percent of the fire department’s budget goes to paying off their pension obligations. The California Pension Tracker notes that the market basis pension liability per household is $81,634. That sum surpasses many residents’ annual income. To fund upcoming pension payments that are currently underfunded, fire unions have called for additional tax measures and service redistribution that ultimately leaves county residents at a disadvantage. So, while residents are seeing costs go up, they’re seeing EMS response times and quality of care diminish. That’s just not right.
Truth in Accounting has released a new analysis of the 10 most populous U.S. cities that includes their largest underlying government units. With the exception of New York City, most municipalities do not include in their annual financial reports the finances of large, underlying government units for which city taxpayers are also responsible, such as school districts, and transit and housing authorities.
This report takes into account these underlying government entities and provides residents and taxpayers in these cities with a more accurate and holistic view of their respective city’s finances. We only include underlying entities that city governments claim responsibility for in their annual financial reports. These underlying governments are essentially subsidiaries of the city and the majority of their debt falls on all city taxpayers. When the unfunded debt of these underlying government units is combined with the county, municipal, and state debt, city taxpayers are on the hook for much more than they think.
The first round of aid for state and local governments is set to go out next week, but with no guidance yet on the spending rules, leaders are becoming increasingly frustrated.
The American Rescue Plan Act (ARPA) included $350 billion in direct aid to states and localities and the law requires the U.S. Department of Treasury to distribute the first tranche by May 10. Since it passed on March 11, the department has been developing guidance on the spending rules with input from government organizations. The ARPA law says governments can use the money for public health crisis expenses and for budget deficits, but more specifics are needed because governments are required to track and report on their spending.
Now, with just days to go until the first round of aid is to be delivered, the rules still aren’t out and frustrations are mounting. This is particularly true for those governments who are receiving direct federal aid for the first time since the pandemic began.