Fresh Loaf

The Atlanta City Council may decide Monday whether to scrap the accounting devise known as the “cash carry-forward.” Readers of my May cover story about the city’s budget debacle will recall that the cash carry-forward was a practice by which city bean-counters would roll the previous year’s surplus into the following year’s budget, providing a reliable revenue cushion.

Or not. The problem was that the city’s outdated accounting methods did not provide an accurate picture of how much money was actually available.

According to an April report by city auditor Leslie Ward, the Franklin administration had consistently overestimated its annual cash carry-forward since the 2003 budget year. This meant the government started out each year thinking it had more money to spend – tens of millions more – than it actually did.

Oops. I blamed the cash carry-forward snafu as a big part of how a seemingly well-managed city had managed to dig itself into a financial hole. The council will consider an ordinance to repeal the section of city code that provides for the cash carry-forward. I don’t claim to be a whiz at accounting, but it seems like a good idea.

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Shirley Franklin finally used the “F word” today in the face of a bleak city revenue forecast.

Unfortunately for municipal employees, that word is “furloughs.”

Starting next month, through the end of the current fiscal year next June 30, all city workers – including police officers and firefighters – will have their work weeks trimmed by four hours. Department heads and managers will be responsible for determining how to reduce staff hours by 10 percent without slashing city services, Franklin announced at a hastily called afternoon press conference.

Still, the mayor conceded, the cutbacks likely will have “some implications” for services.

Franklin’s actions came in reaction to financial reports showing city revenues have been steadily falling for months. Through the first quarter of the fiscal year, she said, collections of sales taxes, property taxes and license fees – the city’s largest revenue sources – have all declined, pulling general fund revenues down by 12 percent.

(more…)

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