The writing has been on the wall for the Hampshire Council of Governments for quite some time — and now it’s time for the state to step in and toss the quasi-government agency a life vest so it can dissolve with some dignity.
The council’s problems didn’t suddenly materialize out of thin air this summer. HCG’s top brass began sounding the alarm some time ago, and in April 2018 went on record as saying the council is in financial trouble.
HCG’s chairman, Russell Peotter, and executive director, Todd Ford, attribute the organization’s struggles to so-called legacy costs, or long-term liabilities from the Hampshire County government, which was dissolved in 1999. These costs include retirement expenses and health benefits. At the same time, desperate for a solution, they warned all county municipalities that they could be held responsible for these liabilities — which are in the millions.
Municipal leaders rightfully balked at that desperate request, including not only those in charge of communities that never joined HCG or left years ago, but also dissatisfied executives from member towns. Leaders in the latter category were also sounding alarm bells about HCG.
Belchertown Town Administrator Gary Brougham, in a May 2018 interview with the Gazette, said the council needs a “wake-up call, “has no sustainable business plan” and is on a “downhill spiral.”
“In my opinion it is so far gone there is no bringing it back,” Brougham said at the time.
A few months earlier, as Hadley voted to put the organization on notice in the fall of 2017 that it would leave on July 1, 2019, Select Board Chair Molly Keegan said the town was making a “business decision.”
“What we’re really looking for is performance here,” Keegan said. Hadley wanted HCG to develop its revenue streams, improve its service and dispel some of the cloud caused by bonuses for its employees.
Additionally, an audit conducted for the fiscal year ending June 30, 2016, found that “… the council has sustained losses in the current and previous years that have raised substantial doubt about its ability to continue as a going concern.”
No matter who or what is to blame — questionable business models, poor leadership or simply being strapped with too many liabilities without the authority to raise money to pay for them — the Hampshire Council of Governments needs help. And it needs the Legislature to come to the rescue. But in approving such a bailout, there needs to be a reckoning of how the agency got in this mess in the first place.
We’d like to see legislators adopt legislation filed last week that aims to dissolve the HCG and cover its financial obligations. The legislation calls for an appropriation of $6.5 million to fund pension liabilities for 65 council retirees, estimated to cost $5.9 million. That money would go to the separate Hampshire County Retirement System. The bill also includes $600,000 for unspecified “other costs associated with the dissolution.”
Filed by Sen. Jo Comerford, D-Northampton, and other senators and representatives, the bill would also protect towns from any liability from the organization’s closure. And it spells out a plan to turn over the historic Hampshire County Courthouse in downtown Northampton to the state’s Division of Capital Asset Management and Maintenance, assuming the city of Northampton doesn’t opt to buy it under a state law that gives it the first chance to do so.
A hearing on the legislation is set for Tuesday at the Statehouse in Boston.
There are some worthwhile programs run out of the HCG, and it’s encouraging that the council has transferred much of that programming, as well as employees, to other entities, including the Franklin Regional Council of Governments.
The Legislature this week approved a $46.1 billion budget three weeks into the current fiscal year that taps into an expected budget surplus and includes $317 million more in spending than either the House or Senate had approved this spring.
Plugging this gap at HCG should be the responsibility of the state and certainly not of Hampshire County municipalities that didn’t oversee HCG’s operations or its finances. But we also know the state often has a dubious track record of passing the bucks — lots of them — to cities and towns in the form of unfunded mandates or unfulfilled promises.
That should not happen in this case. Northampton Mayor David Narkewicz is right when he says that the commonwealth needs to find a way out that doesn’t impact cities and towns.
The state has the money to help HCG. Legislators must get it done.