A credibility problem and Solomon’s Freudian slip
Mayor Winfield: I understand that there’s differing opinions about this and I respectfully acknowledge that, but I believe the characterization of the reference to a surplus in this fund - I have an interest in wanting to gain credibility with the community and I believe that the continued reference to a surplus undermines that and I believe that it discredits us collectively. I’m talking about the staff and the council.
Councilmember Solomon: I completely disagree with that assessment. We have income and we have expenditures. Part of that income is the dedicated half-cent sales tax that was specifically dedicated to the Community Center and Golf Courses. There’s no dispute, look at the original resolution, it’s quite clear. And that is just part of the reality, so that is part of the income. None of us were involved in the purchase of the golf courses but it was obvious at that time that it would need a subsidy. Actually, all of our parks and recs are subsidized by taxes. So, no, I disagree. There is a surplus – the income vs. the expenditures.
Let’s look at the Aquatic Center, income vs. expenditures. There’s a $600,000 difference, so there is a $600,000 loss. You never seem to want to bring that fact up.
Winfield: Actually, I do. Thank you for bringing that up. (He turned to Finance Director, Stacey Lemos and asked the following question). Ms. Lemos...When we talk about a surplus, there’s a revenue side of all these different facilities and there’s an expenditures side. So let’s talk about the Aquatic Center for a moment. What is the revenue?
Stacey Lemos: The revenue from the operations of the Aquatic Center is approx. $600,000.
Winfield: And the expenditures for the Aquatic Center?
Lemos: I believe the expenditures are about $1.2 or $1.3 million dollars.
Winfield: And we refer to that difference as what?
Lemos: Because those operations are included in the General Fund, it’s a subsidy from the General Fund revenues.
Wait for it…
Winfield: Mr. Solomon referred to it as a loss. (Check and Mate).
(Lemos then began talking in circles, first stating that “subsidy” was used for the Aquatic Center because its losses are subsidized with General Fund revenues, but also stating that “subsidy” was “an accounting term” used for the CCF because it’s a separate fund entity.)
Winfield: Thank you and I’ll just add that…what was presented to the Town before the purchase and the half cent sales tax…the projections that were given at that particular time, and projections are projections, but I think we can all agree that they were significantly overly optimistic.
And so what that created was an expectation within the community that the half cent sales tax, yes, was going to provide a subsidy for I think the first two, possibly three years, but not $2.5 million year after year, or $2 million, but that that subsidy was going to be significantly less. The majority of those funds were going to go into capital investments. So that’s where we have this credibility problem - that what was presented to the community at that particular time just simply isn’t what has unfolded. I can accept that. Projections are projections and reality is reality. But to characterize this as a surplus undermines our credibility.
Solomon: My concern is the characterization that the council misrepresented the aspects of this fund and that it lost credibility with the residents of Oro Valley. That is not at all clear, that’s an opinion. There’s just as many people, or more so, who disagree with that opinion. So for the mayor to state that almost as a fact is what I find irresponsible and not fair.
(Then wouldn’t Solomon’s “opinion” about how many people agree or disagree also be “irresponsible and unfair” since he doesn’t know for sure how many people are in each category but he stated it as a fact?)
Solomon continued: We can discuss all we want about income vs. revenue…But I just think it’s inappropriate from the dais to state that council lost credibility, implying that something wasn't presented correctly or done correctly…If some people think there’s a loss of credibility, fine, but that’s certainly not a statement that you’re justified in making from the dais.
Vice-Mayor Barrett: I just want to add that in the previous year’s budget…there was also $6 million dollars budgeted for capital improvements to the Community Center and golf courses and that $6M was originally contemplated as being part of the CCF. So for that type of capital improvements to be budgeted separately and then to still say that the CCF is running a surplus when the original promise was that capital expenditures would be made from the CCF is I think where the difficulty with credibility that the mayor is referring to comes from and I think it’s appropriate for him to call that out if he feels that that’s something that’s important.
Losses? What Losses?
Lemos appeared uneasy when answering Winfield’s question regarding the difference between a loss, a subsidy, and a surplus. My impression was that she does not like to answer questions that haven’t been scripted in advance (as many people believe was the case during the Hiremath reign in order to paint the Community Center and Golf financials in a positive light.) Winfield was trying to point out that you don’t have a surplus when the expenses are higher than the revenues and she just wouldn’t say it.
But that’s OK because Steve Solomon inadvertently said it during his bi-weekly lecture series. And Steve Solomon is always right. Just ask him.
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Diane Peters has lived in Oro Valley since 2003, moving here to escape the humidity of the East Coast. She’s been involved in OV politics and development issues since 2006. In 2014, she organized a citizens group, Citizen Advocates of the Oro Valley General Plan, who over a 9-month period, successfully negotiated a controversial 200-acre development project. In her past life, she worked in medical research at various University Hospitals in New England. Her interests include reading, writing, nature photography, travel, art galleries, museums, and politics.
