Springfield financial control board law enacted
After more than a decade of deteriorating finances in the state’s third-largest city, the governor has signed legislation that turns over fundamental local financial decision-making in Springfield to a finance control board controlled by the governor.
City officials say that Springfield is facing a projected $22 million budget shortfall in its $437 million budget this year and a shortfall is expected next year as well.
On July 9 Gov. Mitt Romney signed special legislation (Chapter 169 of the Acts of 2004) that provides $52 million in interest-free loans to the city in return for the transfer of budget and management decisions from the mayor and City Council to a five-member board appointed by the governor’s administration and finance secretary.
Administration & Finance Secretary Eric Kriss named the control board members on July 14. They are state Revenue Commissioner Alan LeBovidge, businessman Jake Jacobson, and former state official Tom Trimarco, as well as Springfield Mayor Charles Ryan and City Council President Dominic Sarno. Last month the board hired former MBTA official Philip Puccia to serve as executive director.
The board is charged with securing financial stability for the city and is slated to stay in place for three years, or longer if the board chooses.
The new law gives the control board sweeping decision-making authority over appropriations and spending in all municipal departments, including the school department, as well as contracts for goods and services. The board also has control over city borrowing. It may amortize any operational deficits with the approval of the A&F secretary.
The control board has assumed authority, outside of the city charter and ordinances, to supervise and control all city employees, including hiring and firing, and to have control over all personnel matters consistent with state law.
The new law allows the control board to reorganize city government, to set fees and charges, to determine residential and business property tax rates through the classification law, and to call for override or exclusion votes by the electorate.
The law includes a provision for the city to be run in receivership if the control board determines that it does not have the power to restore fiscal stability to the city. If approved by the A&F secretary, the receiver would have the same powers as the control board but would also have broad powers over zoning and building regulations.
Written by MMA Deputy Legislative Director John Robertson
