Holyoke mayor calls for reform in city's financial management

Yahoo

18-05-2025

HOLYOKE — Holyoke Mayor Joshua A. Garcia says he wants to make the city's operations smoother and keep a closer eye on spending. To achieve that, Garcia last week offered two budget plans.
One, at $180 million, shows the cost of running the city as it is. The other could realize savings by 2027 if the city passes what is being called the Holyoke Municipal Finance Modernization Act.
'If we're going to be honest, we know that this is exactly what this city has been needing for a very long time,' Garcia said at his State of the City address Tuesday.
However, union representatives are concerned about potential job losses and the broader impact on municipal employees.
Chris Adams, a leader with the United Food and Commercial Workers Local 1459, said the union is upset because two of its members will have to apply for new city jobs if the change is approved. The local represents about 4,000 members in Western Massachusetts and in parts of Vermont.
Public hearings will be held Monday, May 28 and June 9. The City Council will vote on the spending plan June 17.
City Council President Tessa Murphy-Romboletti said nine votes are needed to adopt the financial reform.
Garcia called on the City Council to pass the reform before the end of this fiscal year, so that it can be in place by July 1.
On other fronts, Garcia this week urged elected leaders to join him in thinking creatively about development and planning.
Garcia has proposed projects like locally controlled broadband, forming a committee for Ingleside development, creating a sports complex and leveraging a quantum computing facility for continued economic growth.
The proposed reform seeks to fix old auditing problems, make the city's financial departments work better and ensure they are more accountable, Garcia said.
The reform will create new finance jobs, like a chief administration financial officer and a comptroller, merge the treasurer and tax collector roles and cut jobs in other departments.
Garcia said the reform will help the city collect money better and predict its financial condition more accurately. The state has suggested creating the chief administration financial officer position for almost 20 years.
In an interview, Murphy-Romboletti said having both plans to review helped her to compare finance department savings.
In 2026, the Holyoke budget will balance out, and by 2027, the city could save up to $100,000 if the City Council agrees to this plan, she said.
The main goal is to get the money needed in the budget to hire for the new jobs if the act is approved, she said.
Garcia hired Timothy J. Plante, Springfield's former chief administrative and financial officer, to help create the new job in Holyoke, she said.
Past problems in municipal finance stemmed from a lack of proper systems and checks, an issue since the 1970s, Murphy-Romboletti said.
The new chief financial officer would be independent and oversee the finance department. The mayor would choose this officer, and the City Council will approve the appointment, she said.
'It feels like checks and balances,' she said. 'It is long overdue.'
Murphy-Romboletti believes the shifts will save money in the long run. 'It's a huge game changer for the long-term financial health of the city,' she said.
Rory Casey, the city treasurer, said the reform would not only enhance efficiencies and save money, but has the potential to generate revenue.
For instance, Casey said the chief administrative and financial officer would pursue grants and reimbursement funding, enabling the city to accrue interest.
Now, approximately $100,000 in interest earnings is being forfeited due to the city's inability to promptly recover owed funds, a consequence of the previously dysfunctional finance department, Casey said.
About 18 full-time jobs will be cut in several departments. Thirteen of these jobs have been empty for a while, but five are filled.
This includes positions in the departments of assessor, City Clerk and Office of Planning and Economic Development.
Others will be cut in the building, fire, and veterans services departments, with three positions eliminated in the Police Department and several more in the Department of Public Works.
The cuts are driven in part by budgetary constraints — but more importantly by a wish to improve government efficiency, Garcia said.
Adams, of United Food and Commercial Workers Local 1459, said this is the first time in his eight years working with the DPW unions they have faced cuts.
Adams, also a union representative for Springfield, and Chicopee, said there are no layoffs in other cities. Holyoke is the only city with layoffs, he said.
The restructuring includes job changes as well as cuts. A maintenance worker at the Holyoke Police Department and another who works at different city buildings will have to take new jobs, Adams said, including one in the parks department. Those workers have been in their roles for 12 and 13 years, he said.
The union plans to file a complaint against the city with the state Department of Labor for the wrongful elimination of union-protected jobs, he said.
Adams said Garcia initially told him the reforms would only cut unfilled positions. Adams said he later learned that two members of the local would need to apply for new jobs without the union having any input, he said.
The majority of the cuts were in the DPW. Adams questions the wisdom of that. Holyoke is the second largest city in Western Massachusetts and already operates with half the staff of cities of similar size, he said.
'Reducing positions will increase the workload for the remaining staff, making it more challenging to manage the needs of such a large city,' he said.
The proposed job cuts aim to reduce expenses. Several factors are driving expenses up for Holyoke, such as rising health care costs, pension obligations and infrastructure maintenance.
Garcia said the school district expects another year of increases in school aid due to the Student Opportunity Act, with aid going up by 5.87%, making the total local contribution of about $13.96 million.
The Student Opportunity Act makes sure schools with more low-income students and kids learning English get more money to help them succeed. Schools must contribute a certain amount of money each year to help pay for education, based on the community's ability to fund it.
Transportation costs are also rising, with a 10.32% increase, totaling $12.78 million.
The city had to go out to bid for a new transportation contract, seeing a 15% increase while other communities saw 17%-25% increases since 2022, the mayor told The Republican.
'We were able to mitigate increases post-pandemic by extending the old contract for another two years, we got the lowest possible rate and locked in a rate with increases for five years in a new five-year contract. Unfortunately, transportation inflation post pandemic is consistent across the country,' he said.
Garcia also highlighted Holyoke schools regaining local control and a new middle school opening in August.
'The School Committee regained decision-making power,' he said. 'Our superintendent will be accountable to only the elected School Committee and the members of the Holyoke Teachers Association will have their right to collective bargain.'
However, Nick Cream, president of the Holyoke Teachers Association, said the union still does not have collective bargaining rights by law.
The budget is complicated, and the teachers' union understands there are real-world constraints. However, since the Student Opportunity Act passed, which educators fought for and won, Holyoke Public Schools have received and continue to receive increases in state funding, Cream said.
'We know that Holyoke Public Schools can afford to pay its teachers, counselors, and other school-based staff the wages we deserve. There are a lot of high-paying salaries at the top of the district's hierarchy, which are a substantial drain on budget resources,' he said in an interview.
One position includes the Chief of Strategy and Turnaround, who Cream says lives in Illinois and was the second-highest paid person in Holyoke Public Schools in 2024, with a yearly salary of $174,000.
Garcia said he expects local Holyoke revenues to grow a bit in the coming fiscal year, but said Proposition 2½ limits tax increases. The $180 million budget keeps core services running without using reserves or free cash.
Garcia said the city stopped using American Rescue Plan Act funds and is now covering expenses with its yearly budget. The city holds $1.5 million in interest earned from ARPA funds, which the treasurer is looking to invest.
Despite financial challenges, Holyoke has made significant investments in government, infrastructure, including upgrades to city buildings, sidewalks, and roads, Garcia said.
In remarks to the City Council, Garcia highlighted the police department's reduction in the overtime budget by 47%, achieved through the introduction of an online scheduling and employee benefits management system.
In February, the city lost two federal grants totaling $20 million due to actions by the Trump administration. Despite this setback, Holyoke has earned an A+ bond rating and high marks for its financial management policies from Standard & Poor's.
Although federal grants were taken away, the city's budget for the coming year is balanced, and its bond rating is good, Garcia said.
Read the original article on MassLive.