October 17, 2012 - The Lies Just Continue

Once again sent to the Mayor and Village Council

To all,

I’ve been reviewing the Village of Palmetto Bay’s Financial Statements in detail and have serious questions. Once again, neither Palmetto Bay’s Village Manager nor Director of Finance has given me the courtesy of a return phone call. So I am submitting this story to the Miami Herald.

What’s a bigger problem than a Village Council which refuses to be fiscally sound? One that uses lies and misinformation comparing itself to other municipalities in Miami-Dade County. At the final budget hearing, before the Mayor and others voted to support the use of 2.3 million dollars of reserves in the fiscal year 2012-2013 Budget, the Mayor described the concept of “Best Practices” to us. In doing so she noted how much healthier our Village’s reserves are than other Miami-Dade municipalities as a defense for spending more than we took in. The Mayor specially referred to Miami Lakes, the City of Miami (Seriously, are those the financial standards your trying to achieve?) and was about to name a third municipality before the Village Manager – no stranger to foot-in-mouth gaffes himself – stopped her. I guess he knew she was going down an indefensible path.

The fact is there is no municipality in Miami Dade County, that I have found, other than the City of Miami, as financially strapped as the Village of Palmetto Bay. (I have done a lot of research over the last few weeks.) Now to be fair, I did not look at every municipality, but I did review the following:
Aventura had, as of 9/2011, $41,309,000 in Total Fund Balance and $39,615,000 in unrestricted reserve balance or 97% of yearly operating expenses;

Pinecrest in their 9/2013 Budget, $18,628,095 in Total Fund Balance, with $8,248,619, in unrestricted reserve balance or 50% of yearly operating expense;

Coral Gables had, as of 9/2011, $60,112,541 in Total Fund Balance, $51,805,505 in unrestricted reserve balance or 40% of yearly operating expenses;

Miami Lakes which the Honorable Mayor quoted “only has 2.5 million in reserves” actually had as of 9/2011 $14,988,614 in Total fund balance, with a $6,947,000 in unrestricted reserve balance or 57% of yearly operating expenses, and;

Cutler Bay budgeted for 9/2012, $10,061,259 in Total fund balance, with unknown unrestricted reserve balance, or 40% of yearly operating expense.

Furthermore, every municipality above is fundamentally increasing their fund balances each budget year, while the Village of Palmetto Bay Council has been raiding our coffers for the past three years to the tune of $10 million total.

Now compare those municipalities with what you think is fiscally sound or “Best Practices:” Palmetto Bay has budgeted for 9/13, an $8,277,734 Total Fund Balance with a $5,419,341 in unrestricted reserve or 36% of yearly operating expenses. That is LESS than every municipality I described above. That doesn’t sound like we have a financially conservative policy or “Best Practices” to me. Maybe we have a different definition of what “Best” means. Maybe to the Palmetto Bay Council Worst Practices is good enough. I’ll get to “Best Practices” in a subsequent email because I’ve done plenty of research on the Mayor’s favorite phase and I’m not sure the Mayor knows what the real definition of “Best Practice” is.

Then add to that that we are facing a 13 million lawsuit without insurance coverage. 13 million is more than the five-and-a-half million we have in unrestricted reserves. But then the council spent more than $10 million in reserves over the last three years. That’s right – the council has spent more than $10 million dollars in the last three years. The Mayor believes this is misinformation – but numbers don’t lie – it’s all on the Palmetto Bay Website. We could only have hoped that the Mayor, Vice Mayor Pariser and Councilwoman Lindsey, all of whom pretend to be fiscally conservative, would have followed the same prudent approach that other municipalities in Miami-Dade County have – saving reserves in case of a hurricane – or maybe a $13 million dollar lawsuit.

As you can tell, the past few weeks I have been reviewing the finances of Palmetto Bay (most of you know I’m an experienced CPA.) It has been like watching a train wreck – I just can’t look away. Maybe a better analogy is that Mayor Stanczyk, Vice Mayor Pariser and Councilwoman Lindsay are driving a train fiscally headed for a cliff.

Either which way, when a concerned citizen who’s a CPA can’t get a meeting or a phone call returned from a Village Manager or Finance Director, when the finances are in turmoil and the Budget is bungled – the future stability of the Village is at stake.

Once again, as previously stated, for your pleasure, all referenced finances are easily substantiated on the Village of Palmetto Bay’s website or those of other municipalities referenced.

David Singer
Recall Palmetto Bay