Providence Finance Committee Chair: city’s financial picture “bleak”
The Providence Finance Committee is working on how to help the city combat the effects of the pandemic on its budget.
PROVIDENCE, R.I. (WLNE) – The Providence Finance Committee is working on how to help the city combat the effects of the pandemic on its budget.
The chairman of the committee Councilor John Igliozzi called the city’s finances “bleak” Monday, with money owed to the pension plan and shortfalls in tax revenue.
“We’re already a quarter into this new fiscal year, and the financial picture is bleak,” said Igliozzi following Monday’s meeting.
With the pandemic shutting down much of the hospitality industry, City CFO Lawrence Mancini said the city saw shortfalls in the meals and beverage, as well as hotel tax, totaling more than $1 million.
Igliozzi says the new fiscal year isn’t showing too much of an improvement.
“And more alarming is that hotel tax is basically nonexistent,” he said.
Also a concern, says Igliozzi, is that the PILOT money the state has yet to pay cites and towns, with their own budget not yet cemented.
“Right now we’re kind of in an artificial financial bubble,” said Igliozzi.
According to officials, the state owes about $24 million in PILOT funding, which the city is planning to put towards its under-funded pension program.
Without that money to make pension payments, Igliozzi says the city is incurring thousands in penalties every day.
“And it doesn’t look like we’ll be able to catch up within the next fiscal year,” he said.
Igliozzi said the city will have to start thinking about taking some serious frugal measures to combat the effects of the pandemic.
ABC 6 reached out to a city spokesperson for comment on whether any so called frugal measures are being considered, but have not heard back.
The committee will continue its discussion on Thursday.