Saturday, July 9, 2016

Where's the Money?

The mayoralty of Vincent DiMonaco began in January of 1989, a year that would prove momentous in both DiMonaco’s life and that of Mitch Ogulewicz. Vinnie was now exercising authority in two roles, both as mayor and as City Council President, an unprecedented level of power to be held by anyone in the modern history of Springfield. As the City Council gathered for its first meeting of the year, acting-Mayor DiMonaco led the Council members and spectators in the Pledge of Allegiance to the flag. When they got to the part about “one nation under God,” Councilor Francis Keough instead sarcastically said, “one nation under Vincent DiMonaco . . ." only he didn’t realize that his microphone was turned on, causing the council chamber (and no doubt the public watching on television) to break out laughing. Unfortunately, laughing at the wit of Frank Keough was one of the few moments of levity the Council would have that year.

It had been obvious for most of the previous year that the city’s finances were in disarray. Some of the problems had to do with factors that Springfield had little control over. As early as May of 1988, Ogulewicz had warned in a Union-News article that, “My greatest fear is that a year from now, whoever is mayor is going to be faced with a fiscal crisis.” He couldn’t have been more right.

The so-called “Massachusetts Economic Miracle” that had propelled Governor Michael Dukakis to the Democratic Presidential Nomination began unraveling even before Dukakis was defeated. The result was a sudden tightening of the purse strings in Boston, leading to significant cutbacks in the local aid which had previously been rising steadily throughout the 80’s and upon which the city had become increasingly dependent.

Also throughout the 80’s, there had been a tight struggle to comply with the tax limiting measure Proposition 2 ½. Passed by Massachusetts’s voters in 1980 as a check on the rapid expansion of municipal government spending in the 1970’s, Prop. 2 ½ limited tax increases from going up by more that two and one-half percent in any one year. After the free-spending 70’s, Springfield was hard pressed to learn to live within a strict budget, although much of the pain was alleviated by the generous increases in state aid.

Most of the credit for Springfield’s financial survival in the face of these challenges was due to former Mayor Ted Dimauro. Despite inheriting a $6 million dollar deficit from his predecessor William Sullivan, through strict fiscal discipline Dimauro was able to wipe out Sullivan's debts and go on to accumulate a surplus of nearly seven million dollars. When Dimauro left office, he passed all that surplus cash on to his successor, Richard Neal. The cruel reality facing the city in 1989 was that somehow every penny of that surplus was found to have vanished after Richard Neal left for congress.

Since Neal had been mayor during a period when Massachusetts had enjoyed such unprecedented economic success that our governor was nominated for the presidency because of it, there simply was no explaining how Neal could have blown the city’s entire surplus during such a time of economic plenty. Unsuccessful attempts were made by the City Council to get an overview of the city’s finances from Neal before he left for Washington, with Councilor Mary Hurley stating in the newspaper, “We have to sit down with the mayor and ask, “What’s up Doc?” Yet Neal departed for Washington without any such meeting being held.

Details of the fiscal mismanagement of the Neal Administration began coming to light almost immediately after Neal left. Fifty new police officers had been hired by Neal, which he had heavily touted as evidence of his commitment to fighting crime. Now it was discovered that he had never budgeted the money to pay their salaries, putting the City Council in the awkward position of considering firing police officers who hadn’t even been on the beat for one year. In the end Police Chief Tommy Fitzgerald was forced to lay most of them off, despite the fact that the city had paid the cost of training them and some had been on the force for as little as four months. In a major embarrassment, officials from Tampa, Florida came up and hired many of them, cashing in on the law enforcement personnel Springfield taxpayers had paid to train but now couldn’t afford to keep. In quick succession other, even more serious problems came to light, so much so that even a die-hard Neal defender like Springfield Newspaper columnist Carol Malley was forced to express dismay:

“City officials have been reeling following a series of surprise announcements of shortages in this year’s budget,” Malley wrote, “and it is unclear how they are going to be made up.” With considerable understatement, Malley conceded that “Neal’s biggest weakness as mayor was probably his inattention to fiscal matters, particularly over the past couple of years.” Such an admission stunned much of the public, who had been told nothing throughout the 80’s (especially not by the Springfield Newspapers) except that Neal’s mayoralty had been an absolute model of effective government. Malley then went on to list the fiscal disasters discovered in Neal’s aftermath.

“City councilors are trying to find out why the health insurance account was underfunded when, according to the personnel director and a health care consultant, the auditor was told a year ago that more money was needed . . . . They are also trying to find out why 50 new police jobs were created and filled, but not funded.”

Attempts were made to get Budget Director/Auditor Henry Piechota to explain the fiscal situation, but the hearings that were held produced nothing but contradictory information, with Piechota alternately claiming that all was well or that all was headed toward disaster. It seemed impossible to determine the true status of the city’s finances.

“What is particularly irking to city councilors,” Malley wrote, “ is that each new shortfall announcement comes to light after assurances that there are no more surprises coming.” Even more infuriating, Piechota kept finding new money where none was thought to exist. “On the other side of the picture,” Malley explained, “Piechota appears to have come up with what councilors are calling “hidden pockets” of money, which they were not told existed when they asked for reports on the fiscal budget. One of the hidden pockets was a “reserve from prior year funds” which none of the councilors had ever heard of before.”

This news of hidden money in mysterious accounts caused an outcry from both the public and the City Council for an indepth inquiry into just what had been going on in the last days of the Neal Administration. But Piechota seemed to be either unable or unwilling to provide the answers.

The rapidly unfolding fiscal crisis was taking place against the backdrop of the campaign to determine whether Vinnie DiMonaco would continue as mayor or be replaced by his challenger Councilor Mary Hurley in a special election. The entire political establishment was behind Hurley, with the exception of only a few prominent persons (such as former Mayor Dimauro) who were backing Vinnie. One of his most colorful backers was Mary Ladeux, a little old lady on Union Street whose home had been in danger of being taken for condominiums. Vinnie successfully lead the fight to preserve her home in which she had lived all her life with the help of Mitch and Kateri Walsh.

Yet despite the fact that all the big power players were behind Hurley, in reality the terms “insider” and “outsider” didn’t really apply in the race, since in the face of the severity of the fiscal crisis, everybody was stuck in the same sinking boat. Indeed, Vinnie and Hurley managed to work together with a surprisingly low degree of political animosity, united by the knowledge that whichever one of them would win the full mayoralty, they would face an overwhelming fiscal challenge.

Vinnie brought both skills and liabilities to the mayor's office. He had a depth of knowledge and experience to share from his decades in public service, and in some respects he was one of the most qualified persons to ever occupy the mayor’s office. Even many of Vinnie’s critics felt that the chance to be acting mayor was a well-deserved culmination of a remarkable career. However, in temperament and personal style DiMonaco was not well equipped to deal with a crisis of the magnitude the city was facing. His manner with Piechota was blunt and often sounded accusatory, creating an atmosphere of defensiveness that made Piechota even less forthcoming.

DiMonaco even went so far as to begin blaming Neal openly for the financial difficulties, which so angered Neal that he threatened to abandon his official neutrality in the mayoral race. Vinnie came to feel that he was badly served by former Neal aide Kevin Kennedy (later Neal’s congressional aide), who seemed more concerned with protecting the congressman’s reputation than he was in fixing the fiscal crisis. DiMonaco would later tell Ogulewicz that he believed that keeping Kevin Kennedy on after Neal left was the worst mistake he had made as mayor, because instead of getting advice that was good for Springfield, he was given advice that was good for Richard Neal.

In any case, in contrast to Vinnie’s outbursts and aggressiveness, Mary Hurley seemed very professional and above the fray. She had Mitch to thank for some of that. Whenever she had a question or comment that she knew would look political or provoke Vinnie, she would ask Mitch to raise the issue instead, thereby getting her point across while not appearing overtly political. Vinnie was too politically sophisticated not to see through their ruse, however, and would growl at Mitch, “We know whose water you’re carrying,” and once even said openly, “Councilor Hurley should have the guts to get up and speak for herself.” Yet the city was looking for a calm voice amidst all the confusion, and with Mitch’s help Hurley was able to project the competent professional image that the electorate was searching for in order to find its way out of the fiscal disaster.

So it was no big surprise on Election Day, April 25th, when Mary Hurley was elected mayor by a landslide margin in the special election. Even Vinnie seemed to take his defeat in stride. He still had his position as Council President, and frankly it was hard to envy Hurley the terribly difficult task that awaited her. What no one knew was that the worst was yet to come.

Here is a video that includes Frankie Keough cracking up the Council with his wit.

This video includes footage relevant to the issues discussed in this chronicle.

These videos deal with issues that were of concern to the Council at the end of 1988.

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