Confusing prosperity ...
A little more than a year ago Defiance’s municipal government was not unlike other communities across the country that were thinking about pressing the fiscal panic button.
City officials, for example, were predicting a 10% reduction in income tax revenues due to the unfolding coronavirus situation. The actual contraction for 2020 was 3.5%, so things weren’t so bad and officials probably could have weathered the storm without federal help.
But bolstered by CARES Relief Act funds, the city was able to grow its general fund reserves by $1 million. Now, with income tax receipts showing double-digit growth in 2021, the city has grown its reserves another $1 million to a record-setting amount of $5.3 million.
This is before the city will receive one penny from the oddly named “American Rescue Plan Act.” In fact, $3.26 million more is coming to a Defiance city government that has no need of additional money for the purpose of rescuing its fiscal fortunes.
And while municipalities are showered with more money, the federal government continues to balloon its enormous debt by handing out money it doesn’t really have. We hope this somehow turns out okay for the country.