To turn the tide of budgetary red ink, Flynn must coax more aid from state
Boston has floated for the past eight years in a sea of red ink, so its financial problems are nothing new. It's not that Boston is a wantonly foolish spender. Nor is the city is incapable of earning its keep. Yet its revenue does not match its spending commitments, says Mayor Raymond L. Flynn.Skip to next paragraph
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The mayor says he plans to curb spending, reduce the payroll, and run city government more efficiently. But, he says, such reform will not be enough.
A broader problem is Boston's dependence on the good graces of others for its bread and butter. The city is hampered by state-mandated budget restrictions, Mayor Flynn says, and needs more fiscal autonomy.
The city's major revenue sources are all limited.
* Under state law, property tax is the only tax Boston can levy. It accounts for the largest portion of Boston's revenue, yet is limited under the provisions of Proposition 2 1/2. In 1980, the property tax accounted for 54 percent of Boston's revenue. This year, it represents only 35 percent.
* State aid has bridged that gap, increasing by more than $100 million since 1980. But legislators from outside Boston often question the amount alloted to the city.
* Departmental revenue has increased over the years. The traffic and parking, public works, health and hospitals, and other departments account for 21 percent of the city's revenue this year. Yet such sources are already tapped, and it is questionable whether they can be counted on for increased revenue.
All totaled (along with the small amount of federal money the city receives), it's evident Boston does not take in enough money to meet its expenses. That's one conclusion of a financial analysis recently released by a committee working for the new mayor's administration.
Mark S. Ferber, chairman of the financial analysis group, says his committee sought to put the city's financial picture in perspective. In a report as thick as a telephone book, the committee's 60 members presented the figures, as well as recommendations they think the new mayor ought to implement.
Boston faces a deficit of $20.6 million dollars this fiscal year, says Mr. Ferber. Next year, the deficit will reach $40.4 million, he projects. And fiscal 1986 looks even bleaker. He predicts it will be the equivalent of ''fiscal Armageddon,'' with a $110 million deficit.
Ferber can't ''begin to say what city programs and the city government would look like under such a staggering deficit. Nineteen-eighty-six will be a disaster.'' But there are ways to avert it, he adds.
Ferber says the city's first step is to get its house in order. For instance, the city has 21,000 employees. The payroll for these employees accounts for three-quarters of the city's budget. But in compiling its financial report, the committee was not able to establish where these 21,000 people work, he says.
City records enabled it to find out where the employees are being paid, but not where they actually are working. The need for strong management guidelines is clear, he says.
Beyond that, Ferber says, the city needs more help from the state. The formula by which Massachusetts cities and towns receive aid should be skewed more toward Boston. Although the city is asking for a larger share of the pie, it should be understood that ''Boston drives the economic development of the rest of the state.''
Ferber says the city pays a disproportionate share of the costs for the Massachusetts Bay Transportation Authority (MBTA), and says other towns should contribute more. Also, the state should operate and pay for the downtown courthouse and the jails.
Ferber suggests that the state legislature enable Boston to implement some means of self-help. For instance, the state should authorize Boston to collect a parking excise tax, he says. This would be another way for commuters to help foot the bill for Boston's services.
The financial group's report has not met with universal acclaim. Samuel R. Tyler, executive director of the Boston Municipal Research Bureau, a private city watchdog organization, says he disagrees with several of the report's specific proposals.
Yet Mr. Tyler agrees with some basic points, such as better city management, changing the state-aid distribution formula, shifting responsibility of the MBTA , jail, and courthouse expenses - and then looking for new sources of revenue.
The success of these changes will depend largely on Flynn's relation with the state legislature. Under former Mayor Kevin H. White, the city and legislature were not close.
Mayor Flynn served in the legislature for eight years, and is intent upon forging a strong, working relationship with that body. Flynn and Ferber discussed the contents of the financial report with the Boston delegation of the legislature and with the City Council.
Mayor Flynn says he thinks ''there are good possibilities within the next two to three years of getting Boston on secure footing.'' Combining sound fiscal management with state help could work to put Boston in a much better financial position, he says.
''Boston's revenue must be predictable,'' Flynn says. ''At present, it is not.''