by Gabe Bullard
The Louisville Metro Council’s Budget Committee learned the ramifications of tapping the city’s rainy day fund at Tuesday’s meeting. The council is considering using the fund to finance payments to firefighters in a settlement over miscalculated overtime.
The committee learned that it could spend a little more than 20 million dollars of the rainy day fund and still maintain the city’s “Strong” credit rating. That would fall about 10 million dollars short of what’s owed to firefighters. Committee chair Jim King suggested that the city could use a combination of rainy day funds and bonds to finance the payments.
The mayor’s administration favors using only bonds to pay the firefighters. Chief financial officer Jane Driskell told the committee that the rainy day fund is an emergency account, and tapping it could be dangerous.
“We sure better have determined a way to build back that fund for future needs, and that is what concerning—I’m speaking now as CFO—concerning in this economic time,” she says.
Some council members oppose bonds because they would accrue interest.
The committee didn’t take any action in the meeting.