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Mayor James J. Fiorentini
State Of Our City Address To The Haverhill City Council* - March 23, 2004
City of Haverhill Massachusetts

Mr. President and members of the city council. Thank you for giving me the opportunity to speak tonight directly to the people of this great city.

Eleven weeks ago, in my inaugural address, I spoke to you of the difficult journey that lay ahead. Eleven weeks ago, I told you that the seas would be rough but that we would get there to build a new and better city.

I am here tonight to tell you that the roughest seas are still to come, but the journey has begun.

Haverhill. Massachusetts Mayor James J. Fiorentini
Haverhill, MA Mayor
James J. Fiorentini

I) The Steps we have taken so far
Eleven weeks ago, we had just settled the lawsuit against Quorum and used those one time funds to keep our public library open. Eleven weeks ago, the newspapers were filled with stories that we would suffer the disgrace of being the first city since Chelsea in 1990 to be taken over by the State and put into receivership. Eleven weeks ago, our deficit stood at $4.2 million. Eleven weeks ago, our situation seemed hopeless.

That was eleven weeks ago. Look at what we have accomplished today.

A) Steps to cut expenses
1) Reorganization of city government
The Mayor and the city council worked together to reorganize city government. We merged four departments into one, eliminated positions at the top, merged our economic development and community development departments, and in the next year and a half saved taxpayers of the city over $200,000 in next years budget.

2) Hiring and spending freeze
We instituted a spending and hiring freeze and stopped all nonessential spending. We refused to fill any position until we were sure that the person we hired would not be laid off in July. I’ve taken some heat for that: but I would rather take the heat than have the taxpayers pay the salary and then pay the unemployment costs for someone we hire and then lay off. I won’t do that to a new hire: and I won’t do it to the taxpayers. Partially because of our actions, this July we will $500,000 in free cash to apply to next year’s deficit.

B) Increasing revenues
But just looking cuts has not been enough. The Council and I have worked together to search for every possible means of increasing new revenues. I’ve been to Boston and spoke with our legislative delegation. Our legislative delegation, led by State Representative Brian Dempsey, listened was able to find an additional $500,000 to help us with next year’s budget deficit. Our delegation is here this evening, and I want to publicly thank them for their work on our behalf: State Representative Brian Dempsey, Representative Harriett Stanley, Representative Barbara L’Italien and our own Senator Steven Baddour.

Then the Council worked with me to institute a tax amnesty program. In slightly over two weeks, the amnesty program has brought in an additional $35 thousand dollars—money that we might have never seen, and certainly would not have seen in this year’s budget.

But the best part of the tax amnesty program did not have to do with money. One elderly woman was about to lose her house because the combination of back taxes, interest and penalties was too much for her to bear. By offering an amnesty on the back interest payments, the amnesty program allowed us to get all the tax dollars we were owed and allowed her to stay in her home.

We’ve reexamined our budget to see if we can allocate more from free cash or from new growth. We have asked the legislature to help us speed up the sale of land. This council had the courage to do the right thing, and voted to bring in an additional $1.1 million in funds by partnering with Aggregate Industries to bring in dirt for our landfill. It was a tough decision, but the city council made the right decision. We were aided by an increase in the outlook for the State allowing us to adjust our figures for State aid.

C) Results—a $4.2 million deficit is now a deficit of less than $ 1.7 million
Working together, look where we are today. Eleven weeks ago, our budget deficit was $4.2 million. Today, that deficit stands at less than $1.7 million.

To the council and the State legislators who worked with us to help make this possible, thank you.

The progress we have made, and the steps that remain, call to mind the words of Winston Churchill:

“This is not the end, this is not even the beginning of the end, but perhaps, this is the end of the beginning….”

D) Efforts to improve the quality of government service
But the budget cutting is not enough. Our job isn’t to deliver the least government possible; it is to deliver the best government affordable. Make no mistake about it, just because we were spending less does not mean we are doing less. We are all working hard to deliver the services that our customers deserve and by and large we are succeeding.

Here at city hall, we used business techniques to measure customer satisfaction rates and to make certain that the people we service are getting what they deserve: good service. We asked our understaffed and overworked staff to do the best that they could.

I am happy to report to you that our employees have risen to the challenge. Our customer survey forms are in, and over 98% of our customers feel that the service they received was excellent.

Many of our customers went out of their way to praise our city hall employees, and to tell us that our employees have gone the extra mile to deliver top flight service.

Here are some of the comments I received:

  • When Sam, a real estate broker went into the assessor’s office, he wrote: “I have been in many assessors’ offices. The fantastic expertise in this office is awesome.”
  • When Steve went to the building inspector’s office, he wrote, “ Sandy was very helpful and walked me through all of the procedures. She is a great and friendly employee.”
  • When an attorney from Lowell went to the tax collector’s office, he wrote, “Everyone was friendly, capable and ready to assist.”

I want all of you to know that the people who are working at city hall are giving it their all under very trying circumstances and I am very proud to be their Mayor.

Our outside of city hall services are also working hard to deliver good customer service. Our police department is overworked and understaffed, but I am pleased to report to you that in the first three months of this year crime is down 2.5%. We are going to work as hard as we can to keep that trend going.

There is so much more good news that I do not have the time to report it all. Our retirement system had another fabulous year and last year their investments rose over 20% in value. Our city treasurer is working hard to deliver better customer service and to speed up the collections of the receivables owed to us. Our assessor’s office has privitizied one of the assessor’s positions to give better service at lower value.

E) The use of volunteers and interns
Our top flight team at city hall has been aided by a top flight team of ordinary citizens who have done something extra ordinary—they have volunteered their time, day after day, at city hall to help their city. They have answered the phones, done the research, met the constituents and made the Mayor’s office a joy to work in. The conference we will hold later this week on rezoning was done entirely by volunteers. In the city clerk’s office, volunteers have handled the census, and the voter list. For the first time in many years, the information booth at city hall is open and staffed with volunteers. This volunteer team is the greatest, many of the volunteers and interns are here today, and I ask them to stand and be recognized.

II) The Road ahead—a Roadmap to Fiscal Stability
A) The scope of the problem
But if we have started the journey -- and we have -- this only shows how far we have to go.

It was difficult to get from a $4.2 million deficit to a deficit of $1.7 million million. To get from a $1.7 million deficit to the balanced budget we are required to produce will require more painful and difficult decisions.

To see how difficult, let us go back one year. My predecessor, after making millions of dollars in budget cuts, was still faced with a $1.1 million deficit. To meet that deficit, he had to close the library, and was able to save it only when the Quorum lawsuit settled.

Our deficit is even greater, and we have no rabbit we can pull out of the hat, no Quorum lawsuit to settle. Our challenge is great, but our determination to save our city is even greater.

Tonight, I outline two plans to meet the challenge—a plan for today and a plan for tomorrow. The basics are simple. It is the same plan that you would use if you had a deficit in your own household budget: you would spend less and try to bring in more.

B) Spending reductions
1) Reorganize Government
To spend less, we need to complete the job we started in January to reorganize city hall. Next month I will present you with a plan to merge departments, cut the number of city owned vehicles, cut and then cut again.

Some of these cuts will be painful. But our responsibility is to present a balanced budget and our responsibility is to lead. This is our challenge.

2) Health Care reform
Of all the expenses we need to cut, the largest and most important is the cost of health insurance for city employees. To cut the cost of health insurance, we need to consolidate the number of health care plans, and become a self-funded health care plan. We are working with our unions and our insurance advisory committee, a committee that has done some great work, we are moving in the right direction.

But, real health care reform can only be achieved if we work with our unions.

When times were good, we tried to be good to our employees.

Now our employees, who have the challenge of working for the city, must be asked to meet a challenge once more. The unions must work with us to save the city and to save their jobs.

I ask the unions to meet the challenge and to work with us.

C) Bring in new revenues-- the key to long term stability
But making cuts is not enough. There are only so many cuts that we can make; there are only so many positions that can be eliminated. You can save a lot of money on a car if you park it in the garage and never use it, but our goal as a city is to get the car moving again and provide the services people need. Once again, we need to search for new revenues.

1) Parking
The first stop on our search has to be the parking lots in Haverhill .

For decades, we have pretended that parking is free, but we all know better. We all know that someone is paying to pave the parking lots, someone is paying to plow them, someone is paying to light them and someone is paying to sweep them. That someone is the taxpayers of this city. We all know that economist Robert A. Heinlein was right when he said “there is no such thing as a free lunch.”

Each year, thousands of people arrive for business at the courthouse or to park in our commuter lots by the train station. If they go to a courthouse in Salem , or Lawrence or Lowell , they are charged. In Haverhill are they not. If they park in the commuter lot maintained by the MBTA, they are charged. If they park in the lots owned by the city, our taxpayers are charged.

It really comes down to this: Free parking isn’t free. Someone is paying and that someone is you. Free parking forces us to lay police officers and firefighters. Free parking is too expensive. It is time we joined with nearly every other city in the area and charged for parking. We have talked about this for years; we have stalled it for years. It is time for action.

2) Charges for services
Sometimes, our search to save a city service means that we have to charge for that service. To save our leaf disposal service, we need to charge for that service, and I will present to the council a plan to do so.

Then we have to examine every other possible source of revenue. In the short run, some of this will be unpopular, but in the long run, the most unpopular thing we can do is to do nothing. I know that any new charges, any new fees are distasteful, but in the long run, nothing is so distasteful, nothing is so unpopular as filthy streets and rising crime. Our job is to protect the public, I intend to do just that.

I am hopeful that we can get through this without the unpopular move of charging for another service, for trash collection, but if that becomes required then we have to face it. I make you this pledge. Before I go down that road, and before I ask the taxpayers to dig deeper, I will look down every other road first.

3) Public Private Partnerships

To look at other roads, and to save other services, we need to study the best practices of cities throughout the country and we need to copy their successes. Let me tell you about a few of them.

  • When Washington , DC found itself with an old and crumbling stadium they sold naming rights to that stadium.
  • When Braintree , Massachusetts found it had a shortage of money in its school budget, they sold advertising on their school buses.
  • When Oakland , California found it could not pay for recreation services, they sold advertising on their ball fields and stadiums.

In the next few weeks, I will file and ordinance to allow us to sell advertising on city owned ball land and to engage in public partnerships throughout the city. This is not a panacea, but we need to try everything.

But not even all of this, not even all that I have proposed will be enough to close the gap. In the end, we can only meet our budget gap if we have a permanent stream of new revenues. Tonight I will lay out our permanent long term solution—but it will take several years before it reaches its potential. A long term solution will not close our short term budget gap. We need a gap solution until our long term plans can kick in.

4) Pension Deferrals—a short term solution
The legislature gave us that gap solution when they unanimously passed last year’s Municipal Relief package: they called it pension deferrals. Pension deferrals do not affect the pensions of our retirees.

I know that some of the councilors are strongly opposed to pension deferrals. I will work with the Council and with our legislative delegation to come up with another solution—and we are working on that solution with the Department of Revenue.

But if it comes to deferring the pension contribution to our system or laying off our policemen and firemen, if it comes to pension deferrals or closing our great public library, then the choice is clear: we need to go for pension deferrals. The city council in Methuen was deeply divided, and deeply divided in their feelings to the Mayor. They put aside their differences to vote unanimously for pension deferrals to save vital services in Methuen . I am hopeful that this council will do the same.

III) The Plan for Tomorrow—Growth in the Urban Core to Bring in new Tax Dollars
The task of meeting a $1.7 million budget deficit seems insurmountable. But Eleven weeks ago, that deficit stood at over double this amount. If we take the bold actions I have outlined, we can meet that challenge and we can balance this budget and we can scrape by for yet another year.

But is that really what we want? None of us ran for office to scrape by.

We ran to make this the great city that we know we can be. Balancing our budget is where we must start, but surely, it can not be where we end.

To make Haverhill great again, we need to tackle the long term infrastructure problems that have put off for far too long. In addition to the plan for today, we need a plan for tomorrow.

Our plan for tomorrow is centered on the old shoe shops and tanneries that still exist in downtown Haverhill .

A) Transit Oriented Design: Haverhill Can be the leader
I am happy to report that our plan for tomorrow started today. Already, numerous developers and building owners in the old shoe district have already expressed interest in turning those old buildings into housing and tax dollars.

Next week, I will ask the council to take the first step to turn that interest into reality: I will present to the council an ordinance to start the process of rezoning downtown. Our goal is to bring to Haverhill young consumers, not as tourists, not as visitors, but to live and to work downtown in what planners call a live work district. Our goal is centered around old factory buildings and around the train station downtown.

The most exciting part of this is that the Romney administration has exactly the same goal. They are looking for cities that have old factory buildings downtown, and have train stations near those old buildings. Their plan is called transit oriented design and it fits exactly together with our plan.

On March 26th, we will bring together those developers together with officials from the Romney administration to speak about the new incentives available to revitalize old industry areas.

Our goal is to be the prototype of transit oriented design, to be the city that the Romney administration can point to and say, here, we did it. Our vision is to become a consumer city, a city where young families are attracted not by the quality of the factories but by the quality of life. To do this, we need a vibrant downtown—and we already have the beginnings of one in the Wingate Street Art and restaurant district. This summer, I will ask the merchants and building owners downtown to take the next step and to become a Business Improvement District. You’ll hear more about this.

B) Attracting Consumers with Good Schools
To attract those young people to Haverhill , we need to have good schools. In the Eleven weeks I have been in office, I have established a dropout commission to study ways to we can help our poorest performing children. I have established the Mayor’s Excellence in Education awards to reward the best performing students.

IV) Fixing Our High School
Now it’s time to tackle the most important education job of all: fixing Haverhill High school .

After decades of talk we have made some progress and there is, finally, a slight glimmer of hope. That glimmer of hope comes because our legislative delegation got us approved to be on the State building assistance board funding list and I thank them for it.

This summer we will stop talking about fixing our high school and we will start fixing it—the handicapped elevator will go in this summer. Next summer, we will put in new windows and begin to reverse decades of neglect.

But once again, our greatest challenges lie ahead. We have to find a way to pay for high school fix up until 2009 when the increased state funding will kick in. We may have to ask our citizens for more to pay more, but before we do, we need to look down every other road we can.

A) Selling off city owned land to front load the high school project
The first place we need to look is at vacant land and the first land we need to look at is The Ornstein Heal Property in Bradford .

This land sits between the railroad tracks and the river and is valued at over $2 million. Our only hope of preserving public access to the river, is if we partner with someone else to develop this land. The council has had this property in committee to study it since Mayor Rurak was in office. Now it is time to act.

In the next few months, I will present the council more property to sell more property and to front load the repair of our high school.

V) Summary
We have two choices ahead of us. We can put our own self-interest as elected officials ahead of the interests of our citizens and ignore the problems that face us. Or, we can do what leaders are paid to do: we can lead. That is our challenge. I know that this council is up to the challenge.

President Kennedy once said: “all this will not be completed in the first one hundred days….but let us begin.” I say to you tonight, “all has not been completed in the first 10 weeks, we have made great strides but let us continue, let us begin, let us work together to build a new Haverhill and let us complete our journey.”

Haverhill can be and it will be, great once again. With your help, we will arrive at our destination.

Thank you and good evening.


*Source: Mayor Jim Fiorentini's Home Page: www.jimfiorentini.com 3-23-04

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