To the editor:
While I miss writing my weekly Mayor’s Desk column which was suspended for the campaign season, I am taking up the offer of the editor to write a letter to the Times.
I would like to address Councilor Bruce Tobey’s outdated assertion that 1.5 percent is an appropriate level of free cash (the Times, Page 1, Monday, Sept. 2).
That may have been true in his day as mayor, but it is no longer true. The Massachusetts Department of Revenue today recommends “under sound financial policies, a community would strive to generate free cash in an amount equal to 3-5 percent of its annual operating budget.”
Under these guidelines, we should be generating between $2.7 and $4.5 million per year. We are right where we should be, and I will continue to manage the city in a fiscally responsible manner.
State and federal governments are no longer subsidizing or bailing out local communities like they used to. We do not want every dollar to be tied into jobs and the operating budget.
We need have the reserve levels, and financial flexibility that free cash represents, in order to address the other expectations citizens have such as fixing schools, swift storm clean-up, road and sidewalk repair or any other unbudgeted and unforeseen expense that arises.
CAROLYN A. KIRK
Mayor, city of Gloucester