Newspaper article The Tuscaloosa News

EDITORIAL: City Leaders Wise to Have Financial Reserve

Newspaper article The Tuscaloosa News

EDITORIAL: City Leaders Wise to Have Financial Reserve

Article excerpt

The city of Tuscaloosa could be in dire financial condition right now. Recovering from the April 27, 2011, tornado has cost the city about $11.4 million. So far, the Federal Emergency Management Agency has covered only about $3.9 million of that.

That means, thus far, that the city is out about $7.5 million. That's enough to create real budgetary problems for cities larger than Tuscaloosa. But Tuscaloosa is not suffering a financial crisis. It is still on sound footing.

That's because, over the years, the city set aside sizeable reserves. It saved money and kept cash on hand in anticipation of the kind of day that it experienced on that April 27.

Building a financial reserve takes discipline. It's always more fun to spend money than it is to save money. Most politicians would much rather show off a new park, new buildings or new recreational facilities than point to a healthy number at the bottom of a financial statement.

It matters little how much cities and counties spend; there is always another project that needs money. …

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