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Health & Fitness

Audit Reveals The City Was Wrong About The Deficit!


The proof is in! The Independent Audit of the city's finances are in and it reveals what some have been saying for over a year and a half; the Mandel Administration may not have been truthful about the city's deficit, or they are simply not competent.

The audit reveals the deficit is more than
 half what the administration said it was. That’s not a "Fiscal Crisis" that is called a "Recession!" Maybe this is why the city didn't want us to see the audit! (Click HERE to see the audit page with info highlighted)

Finally, although its 7 months overdue, the city finally, and reluctantly released the Independent Audit of the City's finances for the fiscal year ending June 30, 2012, the year that supposedly had a $10.25 million deficit and required the declaration of a "Fiscal Crisis" year. Now we know why the city didn’t want to release it, until today, the very night of the budget vote!. The proof is in! The deficit is $5 million less than projected! And in my opinion, like I have been saying for a year and a half the city may have purposely mislead residents about the so called "crisis" about the true nature of the city's fiscal woes for political purposes.

The audit reveals that the deficit is NOT EVEN CLOSE to the "crisis" levels City Manager Jack Schnirman, Council President Scott Mandel, VP Fran Adelson, Eileen Goggin and Len Torres said it was. In fact, in 2004 when I took office, the city had a $7.4 million deficit, and in 6 months we eliminated it without raising taxes a single penny, declaring a "fiscal crisis", or imposing a "deficit surcharge" on over-burdened taxpayers!

According the Independent Audit, the cities overall deficit, for all funds ending June 30, 2012 was $5 million, half the city's last projection! That is not the $15-$20, million the city claimed earlier and used as an excuse to tax, borrow, impose a deficit reduction surcharge on city residents, and utterly slaughter the city's reputation in the media in the process- all for political purposes!

In January 2012 City Manager Jack Schnirman, at his first Long Beach Listens talk in the West End, made the ludicrous statement that the city's deficit may top $40 million. Then, between January 2012 and March 2012 that number feel to above $20 million, then it hovered around $15 million. Then he said the deficit was $14.2 million. Then this fall and winter that deficit number dropped to its current level of $10.25 million. No matter how one cuts it, the Mandel Administration was dead wrong about the true deficit!

The city administration was either wrong the entire time or they lied to us on purpose. Either way, they were wrong to the tune of over $5 million, and they made the taxpayers and the city's reputation pay dearly for it!!

All along I have been questioning the city's deficit numbers. I conceded there was indeed a deficit, just like nearly every other city and town is facing as a result of the Great Recession and its impact on property taxes, sales taxes, loss of federal and state aid, as well as mortgage tax receipts which city depends on for revenue. Indeed the city also went over budget in some areas, especially public saftey. But the bottom line is that the Mandel Administration was dead wrong by at more $5 million and their lying and/or incompetence cost taxpayers plenty. The Mandel Administration's actions may have also done serious, long term damage to the city's reputation which was dragged through the mud by this administration on a daily basis on radio, TV, and in newspapers.

I have been questioning the legitimacy of the administration's "fiscal crisis" and the fact that Jack Schnirman, Scott Mandel, Fran Adelson, and Len Torres may have exaggerated the "crisis" in an attempt to drag Long Beach's reputation through the gutter all for their personal political gain. 

It turns out it was all complete shell game. All smoke and mirrors, orchestrated for political purposes. 

Soon after taking office in January 2012 the city called Moody's to report that there was a huge deficit, around $15 million. It turns out that wasn't true and as a result of their lies and/or incompetence the city's credit rating dropped multiple levels costing taxpayers millions in interest payments on long term loans that were effected by the downgrade.

Then in February 2012, Jack Schnirman, Mandel, Adelson, Torres, and friends, declared a "fiscal crisis" and ordered a "hiring freeze", yet they kept spending money, borrowing, and hiring their political "family and friends" to city positions despite the declaration of a "fiscal crisis."  Over 25 friends and family were hiring, promoted  or given tax[ayers funded awards and/or city contracts!

In blog after blog, I questioned how a "fiscal crisis" and a "hiring freeze" could exist while city hall continued to hire friends and family to city hall jobs. I called it Schnirman's Shell Game. Things simply didn't add up; the Mandel Administration's words did not match their actions and the more the administration cried "wolf" about the "fiscal crisis" the more money they spent on hiring "friends and family."

Then in May 2012 in the name of the "fiscal crisis" the Mandel Administration raised residents' property taxes 11%. Then, in an unprecedented move, in September 2012 they imposed a "deficit surcharge" on all city residents to pay off the "$10.25 million deficit." In the end it was all political smoke and mirrors to make the prior administration look bad, and to make the current administration look like heroes. 

This is 2006 all over again. That year the new Democrat administration raised taxes 25% by declaring the city's finances were in horrible shape and that the prior administration was incompetent. The truth was, the city's finances were on track. History has a funny way of repeating itself, especially when the same puppet masters from 2006 are pulling the strings in 2012-13.

The proof is in, and its indisputable. Schnirman, Mandel, Adelson, Torres, and Goggin either lied to us intentionally for political reasons or they didn't know what they were doing. It's that simple. They can and will spin the audit and the numbers, but the final deficit is $5 million less than they predicted! They will even try to take credit for lowering the deficit, but that is disingenuous as well...they didn't cut  the budget until August, when the fiscal year alreayd ended twi (2) months prior, on June 20, 2012!

In the meantime the taxpyers have been forced to pay more in taxes and the City of Long Beach's reputation has been dragged through the gutter, daily in the press and media.  Long Beach and the taxpayers have paid an extremely high price for the Mandel Administration's lies and incompetence; its time for them to go!

Better yet, maybe its time for a criminal investigation into this matter by the Nassau County District Attorney, the State Attorney General, and the federal government.

What Mandel, Goggin, Torres, Adelson,and Schnirman did to this city in inexcusable. They will try to talk their way out of this with confusing numbers and innuendo but the audit document is in black and white; the bottom line is the bottom line.

Did they lie? Were they incompetent? Maybe an investigation will reveal the truth like this audit has revealed the truth!

I'm sure the story doesn't end here, however. Next we need to see how much manipulation the Mandel Administration engaged in to inflate the deficit as the fiscal year came to an end in June 2012. For example, did the city hold back any bank deposits to city accounts in an effort to inflate the projected deficit? If so, how much were those checks and how long did the city have them before they deposited them after June 30, 2012? I FOILed that information last week..... time will tell! If their the Mandel's Administration's past practices are any indication, there could be much, much more to this story!And I believe there will be!

Stay tuned!

Details: The important pages in the audit document are on page 7. On that page, under "Govermental Funds" it states, "Governmental Funds an overall fund balance deficit of $5,051,684.  

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