Voters in East Providence approved four amendments to the city charter last Tuesday, Nov. 6, that should promote “fiscal stability” and help to “manage the city better.”
So said City Manager Peter Graczykowski on Thursday morning. He couldn’t be happier that voters approved the changes to the charter.
Which go into effect immediately, he emphasized.
“I’m very pleased,” he said. “I’m glad they endorsed them.”
Three of the four amendments were approved overwhelmingly by voters. The fourth, establishing four-year terms of office, was less so but still had a 54 to 45 percent margin of victory.
The amendments, Graczykowski said, are a few more steps forward in helping to pull East Providence out of its financial quagmire and return control of city finances to local officials from the Budget Commission.
The first two amendments on the ballot give the City Council the ability to synchronize the fiscal and tax years and to build up a “rainy day” savings account.
The final two allow the city to recruit farther and wider for key city officials and don't require them to live in the city, and give city councilors and school committee members four-year terms of office starting in 2014.
“There are no restrictions now on going outside of the city if the council wants to find talented officials,” he said.
An RFP for new legal services, for instance, went out Thursday, Graczykowski said. He did not have to limit the search to East Providence.
The reserve fund gives East Providence for the first time a pot of money it can dip into if it needs to for emergencies. Every other muncipality in Rhode Island has some type of reserve fund.
“It’s like a savings account the city never had before,” Graczykowski said.
The money will come from holding spending at 99 percent of revenues, with the remainder going into the reserve fund. With a $100 million budget, he said, $99 million could be spent. The $1 million would be set aside for a rainy day.
“We can borrow from it if we need to,” he said. “But we must pay it back within three years.”
And the reserve fund won’t add to the tax bill because it’s not being added; it’s coming from money not being spent.
How the City Council decides to synchronize the fiscal and tax years remains to be determined. It could happen all at once; it could happen gradually over several years. The latter would take special legislation in the General Assembly to do it.
“We’ll let the financial experts tell us the least expensive way,” he said.
Either way, the city is looking to change its fiscal year from Nov. 1 to Oct. 31 to July 1 to June 30 – the fiscal year followed by other municipalities in Rhode Island.