By THOMAS GRILLO
LYNN — Help is on the way to balance the city’s budget.
Thanks to the state Department of Revenue, Lynn received a $75,000 grant to help City Hall create a five-year plan toward better fiscal responsibility.
“DOR is obviously concerned about the city’s financial situation,” said Peter Caron, Lynn’s chief financial officer. “They believe we need long-range financial planning, which we lack.”
Under the terms of the Community Compact, PFM Group, the Philadelphia financial advisory services firm that specializes in working with municipalities, will provide the city with consultants and software early next year. By next spring, the city will be taught to develop a multi-year budget forecast model, create a capital planning framework and implement a high-level review of the city’s finance organization and operations.
Caron said DOR saw red flags based on the fact that the city’s reserves have plummeted and budgets have not been balanced.
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The other factor that contributed to the DOR’s assistance has been the city’s approval for two $4 million bonds over the last few years to pay to renovate parks. Such small projects should be paid for by the city budget instead of being financed over a decade.
The mayor and the city council use bonds because they don’t have the money in their budget to pay for such repairs, Caron said.
From DOR’s perspective, bonds should be limited to pricey capital projects such as replacing the boiler at the library and improvements to the Lynn Auditorium, Caron said.
“DOR sees us going down a road that is not sustainable and we need to implement financial planning,” he said.
The goal is to promote best practices in the financial areas of city operations and to do long-range financial planning so the city can identify resources going forward.
In addition, there should be planning for capital costs, so the city will not be caught off guard.
“We don’t get into a situation where we will suddenly need 30 new police cruisers,” said James Lamanna, the city’s attorney. “We will be much better off if we know today that within three- to-five years we may need new cruisers, a fire engine or playground equipment.”
For his part, Caron said he has tried to implement financial controls over the years, but has met resistance.
“It’s tough getting through to department heads who have been used to doing things a certain way,” Caron said. “But if I have a third party making recommendations, that could have an impact.”
DOR and Mayor Judith Flanagan Kennedy did not respond to a request for comment.
Thomas Grillo can be reached at [email protected].