December 19, 2014
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Avedisian lists pluses of ’13, cites ’14 challenges
MAYOR SCOTT AVEDISIAN

It’s the last day of 2013 and Scott Avedisian is casually dressed and on the job that he had for the last 14 years. Now, another milestone in his administration is about to be marked, although no one is keeping score.

He looks up at the scaffolding around the City Hall tower. Workers are lowering planks now that the spire and weather vane on the dome have been replaced. The crowning elements to an $850,000 renovation of the historic tower were lifted to their perch at 6:45 that morning when the winds were calm.

“It is a good thing that project is done on the last day of the year,” he says to Robert O’Donnell of E.F. O’Donnell & Sons that completed the work.

Back in his office, Avedisian barely mentions the City Hall project as he is asked to underline the highlights and disappointments of 2013 and the challenges of the New Year.

Avedisian is prepared for the interview. He pulls several manila folders from a desk drawer. They are fat with newspaper clippings and press releases from 2013.

“These can be stored now,” he says, making one wonder how many file cabinets are filled with clippings and reports from prior years.

With this packet in front of him, but without leafing through the contents, Avedisian starts.

“A budget surplus is always welcome,” he says. While the audit hasn’t been finalized, an action that will come in the next two weeks, the surplus for the fiscal year ended June 30, 2013 is projected at $2.4 million.

He ticks through a number of recent announcements as achievements, including the fact that city businesses lead the state in Small Business Administration loans for the year; the branding of the Warwick Station District as City Centre Warwick and the marketing plan for the district; demolition of the former Potowomut School and the start of construction of a fire station on the site; and the start of work at the airport on extended runway safety areas.

He mentions the preservation of the Elizabeth Mill with the sale of the Leviton Manufacturing 80-acre parcel to developer Michael Integlia; the implementation of a lock box system for the rapid deposit of tax and utility payments; the city’s continued high level of recycling; and improved communications following the boil water advisory the Kent County Water Authority issued when e. coli was detected in one of its storage tanks.

The list of positive developments in the last year goes on.

Avedisian cites the high occupancy of hotels and the plan for a boutique Wyndham Hotel in Apponaug, which has yet to gain City Council approval; the success of the Ocean State Theatre Company in their new location on Jefferson Boulevard; city pension returns that exceeded state pensions; completion of the Natick Bridge over the Pawtuxet; the city-built “Danger Bridge” on Sea View Avenue in Oakland Beach; the return of the Pawtuxet Rangers’ charter; and the partnership that could lead to opening Conimicut Lighthouse to tours.

“The honor flights were really good,” he says of bringing World War II veterans to Washington and the memorial there. He mentions jetBlue’s commencement of service from Green Airport as another plus. Avedisian says he has a good relationship with Kelly Fredericks, who was named president and CEO of the Rhode Island Airport Corporation to succeed Kevin Dillon during the year.

“He’s good to deal with. We have frank and open discussions … he’s sincere and desperately wants to make this work for the city and the state,” he said.

By and large, Avedisian senses the economy was better in 2013 and feels that people are more optimistic going into 2014 than they were a year ago. He says foreclosures are down and a number of new businesses opened.

Thinking of negatives, Avedisian lists the death of former Secretary of State Susan Farmer, the drowning of a youth at Conimicut Point; Carol Pratt’s decision to close her country store in Apponaug; and how the city is left with only one independent pharmacy – Suburban Pharmacy – with the sale of Oxnard to CVS.

He doesn’t volunteer anything on the recommendation to close Aldrich and Gorton Junior High Schools that the School Committee rejected in favor of delaying the process and hiring a consultant to study the situation.

“It’s positive and negative,” he says when asked about schools. On the positive, he says the system has many dedicated teachers and administrators. He wants to get to know better new principals in the system and “see how we can work with them.” He doesn’t elaborate on school negatives.

Looking ahead, Avedisian says, “I think finances are always a major challenge.” He doesn’t foresee any cuts in state funding for the city. The budget has always been a top priority for Avedisian and, with the exception of one year, he has consistently produced surpluses, yet incremental tax increases have likewise become a feature of his administration, even if they are below state limits. On the topic of taxes, he notes that the city’s motor vehicle tax ranks low when compared to other municipalities, a fact that he believes is not known by many. Avedisian remains sensitive to the criticisms of a small group that argue that the city is headed for fiscal Armageddon because of the debt it is carrying and the cost of post-retirement health benefits for municipal employees. He feels they don’t accurately portray the city’s condition.

Going into the New Year, Avedisian cites escalating flood insurance premiums (as a result of the end of federal subsides to the program) as a major issue. There are reports that premiums for $250,000 of coverage have leapt from $5,600 to as high as $32,000 a year. Avedisian doesn’t suggest how the city can assist these homeowners and he feels current legislative efforts will only postpone the increases, not resolve the problem.

As for being an election year, Avedisian turns his focus to statewide races. He talks briefly about the gubernatorial campaign and how the Democratic and Republican primaries promise to be especially interesting this time.

“I don’t think you’ve seen all the candidates yet … maybe not heard all the names yet,” he says.

It’s a twist in the interview. What are his political plans; might he be thinking of a statewide office? Avedisian has been asked the question many times in many different years. Again, he’s not ready to say; although the word on the street is that he’ll run for an eighth term.

Might his name be among those not heard for a statewide office?

“You can never tell,” he answers.


Comments
20 comments on this item

1. He won't say boo about the negatives of keeping Vets open.

2. We're supposed to be pleased because the annual property tax increases aren't at the state max.

3. Only 14 towns have a higher motor vehicle tax than Warwick. That means 66% of towns have a lower tax rate. Hardly a positive.

Once again John Howell shows that he and his paper are of little substance.

"Avedisian remains sensitive to the criticisms of a small group that argue that the city is headed for fiscal Armageddon because of the debt it is carrying and the cost of post-retirement health benefits for municipal employees. He feels they don’t accurately portray the city’s condition."

so what are the numbers here?

Good point hepdog. "He feels" does not address the financial challenges facing this city; In fact, "He feels" just allows him to skate by the issue as he has shown to be very good at. Avedisian has failed to show that he is able to address and counter with either additional information or facts the considerable amount of data that shows that during his time in office, his policies, has brought this city to a fiscal brink. In reading that entire article, there appears to be NO mention of an increase in the city's taxable property base. What has he done? Preserved a mill, had a charter returned, maybe a tour of a lighthouse? And as for the motor vehicle tax, my overall Warwick taxes went up 14% a couple of years ago when he changed the vehicle exclusion amount.

If a group, "small group" , of taxpayers went before the city council and stated that they FELT the city was on the wrong track they would be laughed at and told to prove it. Avedisian should be required to provide information and facts that support his "feelings". My bet, HE CAN"T.

Mayor Avedisian "feels they don’t accurately portray the city’s condition".

Here are some of the numbers that accurately portray the condition:

2004 Employee Benefits, $30,303,158 - 31% of budget - 2014, $53,842,019 or 43% of city budget (10 year chg +77.6%)

2004 Physical Resources, $11,487,266 or 12% of budget - 2014, $14,471,080 or 11% of city budget (10 year chg +26%)

2004 Social Services, $6,668,351 or 7% of budget - 2014, $5,459,873 or 4% of city budget (10 year chg -18%)

2004 Public Safety, $33,239,838 or 35% of budget - 2014, $39,279,721 or 31% of city budget (10 year chg +18%)

2004 Executive & Admin, $14,042,406 or 15% of budget - 2014, $13,269,390 or 11% of city budget (10 year chg -5.5%)

Allocation of new revenue since 2004 to city budget

Salary, sick pay, etc., $6,632,867, 21.7%

Active Employee Healthcare, $6,174,191, 20.2%

Retiree Pension & Healthcare $15,996,209, 52.3%

All other expenses, $1,777,797, 5.8%

And its going to get worse, because:

Pension Liability $628,776,187

Other Post Employment Benefit Liability (OPEB) $283,220,644

Total Liability $911,996,831 (add in outstanding bond debt and the total is well over $1 billion)

Pension Assets: $322,067,214

OPEB Assets: $0

Pension overall funding ration: 51.2%

OPEB overall funding ration: 0%

All benefit funding ration: 35.3%

One example of the extent of the problem: The funding plan for Police/Fire I pension plan submitted to the state will result in $314 million being spent over the next 14 years to reduce the accrued liability in the plan by $4.6 million. That plan was described as "reasonable" by the mayor when he testified before the state commission. The actuarial expert testified before the city council that, "It's not my job to tell you whether you can afford to fund it nor not. My job is to tell you what it costs".

Why would any politician want to comment on these facts. It's much easier to "feel" that the "small group" is not "accurately portray the city’s condition".

Lets wait and see what Avedisians official response is on Thursday to the latest documentation of Warwick corruption. Watch the Hummel report Thursday. Just more of the same taxpayer screwing by our "public servants" with no consequences.

Scottie never ceases to amaze.....over $600 million in unfunded healthcare and pensions but taxpayers don't worry Scottie got the answer..

The only problem Avedisian doesn't share the answer with the taxpayers. He is fiscally inept

Oh no the sky is falling the sky is falling. LOL !

Hey Michael2012, the sky may not be falling and you can laugh all you want, but this city's tax base is NOT growing. Rhode Island has one major welfare city (Providence). No one wants to end up where like that city.

Michael2012, study those factual numbers I posted comparing the city budget allocation from ten years ago to today. Then consider that since 2007 the local property tax dollars to the city has grown from $63,927,230 to $99,568,368 in the 2014 budget, for a 55.7 percent increase. School allocation in 2007 was $113,125,355. Today its $118,644,632, for a 4.8 percent increase.

That means practically 100% of the local property tax increases over the last 7 years has gone to the city budget.

Wouldn't you think that if the public safety, DPW, and Social Services budget would at least remain at the same level of the overall city budget over ten years that more programs and service could be offered to the citizens of Warwick?

For example for the Public Safety budget to remain at the same 35% of the budget in 2004, it should be budgeted at $44,2 million. That $5 million more then the current level. I gaurantee the Police and Fire department could provide more services and use the new equipment to perform their jobs.

The Social services budget is down 18% from ten yeras ago. If it was at the same percent of the budget from 10 years ago, it would be at $8.8 million. That's $2.2 million more. With those funds the youth programs that were eliminated and the other family service programs eliminated could still be offered.

Michael you are the type of guy that would tell a person with a few lumps in their body to ignore them since they are feeling fine with no apparant visability to any probelm. Years later when they start getting sick you would then recommend they go see a doctor. However by that time those lumps would have turned into cancerous tumors with painful consequences and the probability of curing them much less then if the symptoms were treated when discovered.

Warwick is that patient in the initial stages of cancer but you and the mayor and all the political leaders in this city don't want to recognize that problem. It's easier to proclaim it's not a "accurate portrait of the city’s condition" and let someone else worry about it in the future.

We don't ever get a solution from Cushman? Always throws these cut and paste lines at us but never gives a possible solution to the so called problem. Same with Captain Rob....

Correction the social service budget to remain at the 2004 percent of the budget would require $3.4 million more, not the $2.2 million I posted above.

$126,322,083(2114 proposed budget) * .07(2004 allocation %) = $8.8 million - $5.4 million(2014 allocation) = $3.4 million.

DPW would require $126,322,083 * .12 = $15.2 million - $14.4 million (2014 allocation) = $800,000. Just think how many miles of road could be repaved with that new money.

If Employee benefits remained at 31 percent of the 2014 budget, $39.1 million would be allocated to it instead of the current $53.8 million, freeing up $14.7 million to go to all the other departments in the city. Imagine what an impact that would have on the services provided and aid in the police, fire and municipal employees to do their jobs with better equipment and better training and more employees.

SteveD - solution, reform retired employee benefit programs. Real reforms that cut cost today, not the Avedisian pension reforms that didn't cut one penny in the over $900 million in liabilities.

Those numbers above prove that even with tens of millions of new tax dollars flowing into the city budget over the last ten years, it is not enough to pay for these benefits. The cost of the benefits are not sustainable even with city deparment budget dollars and school dollars being siphoned off to help pay these expenses.

The amount of new tax dollars required to pay for these beenfits is going to continue increase every year. That means less and less will go to the Police, fire and DPW and schools. Reallocating saved dollars back into those department is the answer.

Unless the Warwick economy can produced millions of dollars in new tax revenue (which I doubt it can), more and more programs and services will be cut. At some point all the deparments are going to find it difficult to function like this.

BTW Steve those lines are not cut and pasted. I have been collecting city budget for ten years and this is my analysis. One would think that the mayor and the city council would want to do the same thing to look at the trends developing in the city. Why do that, they might discover the city has a problem? Denying there is a problem is a much easier path to take.

Thanks Bob for posting this info. Probably involves a lot of digging on your part.

Thanks Hepdog. It actually doesn't take I lot of digging once the data is collected. I have a spreadsheet of every line item in the city budget expensed over the last ten years along with revenue data too. It's pretty easy to conduct an analysis once the data is collected.

Take note in May when the budget process takes place. At most the city publishes three years worth of data. previous fiscal year, current fiscal year and the proposed budget. How can one really understand what is going on with any budget when you are looking at only three years? I have stood before the mayor and his deparment directors and financial experts and they can't answer questions when I reference data 5 to 10 years in the past. I have provided Councilwoman Vella-Wilkinfson and all the members of the finance commitee with this data. They ignores it.

OMG! The Mayor looks like Foster Brooks.

Wow that Hummel report was earth shattering. Unregistered car, can't believe this travesty is going on in our city. Get the FBI and secret service involved right away. Excellent work by Jim Hummel. Thanks for the tip Captain Rob.

Stevie D,

Again you have missed the bigger point of the issue. The point is that once again in Warwick the municipal employee is screwing the taxpayer who pays her salary. You have also chosen to ignore the fact that she is in violation of a number of Rhode Island criminal statutes which have also been ignored by the police department and the administration. The statute 33-11- 17 is specific to signing a false name on the TR-1 registration form. It results in a loss of registration and suspension of license, but the city chose not to enforce the law again when it comes to one of their employees.

Additionally how does her registration come back with the address of the Warwick Police Department and signed by a dead guy? Yet another violation.

Conveyance of a license plate to an unregistered automobile is another criminal violation, no enforcement action taken.

And then there's the very minor issue that she hasn't paid sales tax, property taxes andregistration fees.

Maybe in your world all of this should be ignored, but although it may not be earth shattring it certainly exemplifies the failures and favoritisms of the administration and also serves as an example of the moral quality of our municiple employees.

I hate seeing the working men and women of Warwick fire, police etc. getting squeezed by mistakes made in the 70's and 80's.

Patientman that is exactly what is happening not only for the city employees but funding for Warwick’s education system.

The last time the pension and OPEB actuarial experts testified before the city council they stated that it is going to be more difficult to give active employee annual raises while maintaining Annual Required Contributions (ARC) to the 4 pension plans and OPEB retiree healthcare.

Look at those numbers I posted above over the last ten years. Not only is practically all the new tax dollars being allocated to retiree costs but the non-personnel related dollars in the police, fire and municipal budgets has been drastically reduced as a percentage of the overall budget ten years ago. These dollars have been re-directed to help pay for retiree costs that are going to continue to increase at an even faster rate very soon.

It's a triple whammy for the current employees, fewer employees asked to do the same amount of work or services reduced to account for fewer employees, less compensation for active employees and fewer dollars to purchases materials the employees need to do an adequate job.

Do you think the DPW would love to have an additional $800,000 budgeted each year to pave the pot holed filled road around the city? At some point are police, fire and DPW vehicles going to be dilapidated because there are no funds to purchase new ones in a timely manner?

Look at the last contract where employee base pay was frozen for 3 years. What I expect is going to happen in the next round of negotiations is that all three unions are going to demand a significant increase in wages, which this mayor and the council will most likely agree too. And the city may be able in the short term to fund the raises by continuing to squeeze the non-personal parts of the department budgets and squeezing the school department , who btw should have consolidated schools to save millions. The city also may get lucky with a small increase in tax revenue with the slight improvement in the economy.

But the city is going to required tens of millions of dollars that I don't believe the Warwick economy can sustain to pay for all these new expenses. The pension and OPEB cost are going to get much worse and I fear that Mayor Avedisian and Councilwoman Donna Travis and Finance Chairwoman Carmile Vella-Wilkingson plan is to just ignore it.

At some point when Avedisian finally moves on or is defeated (hopefully soon) I predict the next mayor will have to declare a financial crisis and Warwick taxpayers will experience massive property tax increases.

The kind of structural changes necessary to create a revenue stream that can sustain the cost of current city and school service and retiree costs will never take place with the current elected leadership in this city. That will require a no nonsense leader in the mayor's office and an equally committed City Council who are not afraid to address the union contractual language regarding retiree benefits whose expenses cannot be sustained without major reforms.

I simply can't understand why the mayor won't go to the retiree's for relief. The evidence is clear. Surely the retiree's will do whats right for the current and future workers. Retiree's in Providence and Cranston both agreed to concessions to help save their cities. I trust Warwick's to do the same.

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