Crestwood Ward 3 Alderman Jerry Miguel’s dire financial projections for the city last week drew fire from other aldermen, particularly Acting Mayor Richard Breeding of Ward 1 and Ward 4 Alderman Tom Fagan.

Financial projections Miguel made at the June 22 meeting attracted criticism from Ward 2 Alderman Tim Trueblood and Fagan.

At the July 13 meeting, Miguel presented a five-year financial forecast that projected a deficit of $2.62 million in 2009 that would contribute to a cumulative deficit of more than $6 million that same year.

Noting that he previously presented information to the board regarding the city’s economic future, Miguel said last week, “… I have done additional work on that and the followup work that I have which I wish to present to the board this evening is a very basic five-year forecast. Now forecasting is not an exact science. I don’t have a crystal ball. I don’t claim to be a forecast expert …”

He later added, “… As I see it, we are facing two clear trends that adversely affect our future — the future of the city — namely personnel costs and a declining sales-tax revenue base,” Miguel said, distributing his projections to aldermen.

Ward 2 Alderman Jim Kelleher later asked City Administrator Don Greer, “… Is it valid to assume that our budget will remain static from this year to 2009?”

Greer said, “No, it’s not.”

Ward 3 Alderman Don Maddox said, “I guess I would simply regard this as a warning, you know, he flags a couple of issues that we need to be aware of and need to be cognizant of as we go forward year by year. So I think it’s a reasonable warning. Who knows what’s going to happen with sales tax in the next couple of years. There is a trend. The trend is down. Let’s hope it’s bottomed out and it’ll start to go back up, especially with some of the businesses coming that we’ve got coming in …”

Breeding said, “I do have something to add, somewhat in comment to Alderman Miguel’s statements. I have to preface this by stating more than an acting mayor or an alderman, I am a resident and I’m glad I live in Ward 1, let’s put it that way. I am shocked that you can sit there and constantly go over the negative, negative, negative, when we saw what you did for the petition audit that cost us all this money and I’m shocked at how far against you are to the development at the Creston Center and we’ve even talked about building around the Creston Center and working those things out.

“I don’t think I’m going to sleep tonight. Alderman Trueblood had a good point: Let’s think of some things to do to turn this ship around. I appreciate the warning and the hours you must have taken to put into this. That’s hard work, but we need more of the other. We see this coming …,” he added.

Fagan said, “I think everybody on the board realizes there are some problems with the sales-tax revenues vs. expenditures, but frankly this is irresponsible to do this type of static equation without taking into (account) factors of whether the economy is going to do better or do worse, without considering a whole host of other factors. To sit there and put out in the public that in 2009, we’re going to have — if I’m reading this correctly — a deficit of, total, is it $2.6 million or $6 million?”

Miguel said, “The annual deficit in 2009 is $2.6 million.”

Fagan said, “And what’s the fund balance?”

Miguel said, “That would be the cumulative deficit.”

Fagan asked, “Which is $6 million?”

Miguel said, “All funds — $6 million in the hole if current trends continue.”

Fagan said, “Well, I mean, frankly it’s like I tell people, if you put a bad number into a computer program, you’re going to get a bad number out and I appreciate all your hard work and I’m sure you spent time putting these numbers in, but frankly the assumptions I don’t think can be substantiated and I think that’s pretty irresponsible to say we’re going to have — or throw that number out — we’re going to have a $6 million deficit in 2009.”

Noting that he recently met with Miguel to discuss the city’s finances and that Maddox also was present for much of the discussion, Greer said, “I have expressed to him, as I will to you, that while I — I consider this too simplistic an approach with regard to forecasting. The core element I think of what Alderman Miguel is conveying is that something significant has to be done. I have to echo that. I’ve been telling you that myself for some time now and that’s why we’re starting these work sessions to discuss these very topics.

“I can tell you that I do not agree with this approach and some of the assumptions. And in Alderman Miguel’s behalf, he suggested some of his assumptions based upon those conversations that we had. I do believe this is overly simplistic for projecting our future,” he said, “However, the reality is we are today operating in a deficit position. That is real. If we do not make some significant changes in either our revenue or our operating expenses, that will continue …”

Noting Greer that evening was authorized to fill four positions, Miguel later said, “This is a warning. It’s a wake-up call. It’s not a pretty picture, but I haven’t seen this board willing to face reality and this evening to me was another example of passing, of approving four positions. We have got to get our expenses under control. As I’ve heard in this meeting many a time, we don’t have much control on our revenue, what we can control are our expenses. I mean I would hope that that’s what we’re doing with these departmental reviews, but even in that first review that we had, I just sensed hands off. You know, these things are sacred, we can’t touch them. So I hope I don’t disturb your sleep tonight. I don’t intend to be negative, but I don’t know how else to ring the bell.”

Fagan later said, “I think everybody on this board knows our expenses have increased and our revenues have decreased. We don’t need a 15-minute dissertation to go into assumptions that are erroneous frankly or there’s little basis in fact. You cannot, I mean I don’t know if some CPA would tell me that, that may make me a little more comfortable. Just to take a static approach and say this is the worst-case scenario, the sky is falling, the economy is not going to get any better, certain things aren’t going to happen, I think that really does a disservice to what we’re trying to do here.

“And frankly to make your grandstanding comment about we don’t get it or we don’t seem to care or that’s the inference, frankly that is farther from the truth, about the farthest thing from the truth. And for you to say we don’t care and that’s why we voted for four positions is frankly ridiculous. There are a whole host of factors, I think we’ve enumerated them tonight as to why we may think those are valid reasons why to put those people on. If you don’t agree with them, you have every right to express your displeasure and your disagreement, but frankly your implication that we don’t care and we don’t have a handle on it is simply false,” Fagan added.