RAINY DAY FUND: FACT OR FICTION

I have reported many times on this site about the budget and asked questions of where did the money go. At this time there still has been no release of the CAFR which prior to this year was released no later than December 21. Hmm. One month overdue and counting.

The title of this article begs the question of whether the rainy day fund is myth or reality. The reason this question comes up is a simple one. No one can show where the account is that has the so called rainy day fund. After speaking with some individuals the general response is the rainy day fund is not money on hand but assets etc.

A Rainy day fund is a savings account that you keep separate from your other savings to be used in emergencies. It is real money not assets. Cash on hand, money market accounts something that can be accessed immediately when needed.

This brings up the question what is the value of the assets.

As Abramson has stated the rainy day fund has millions (varying from $68 million to upwards of $90 million depending on your source) and he says this is money to be used in the event that the whole City collapses financially we can still pay our bills for 2 months.

Great concept but I have to wonder. How can we pay our bills for 2 months based on assets not cash?

The assets would have to be sold to get the money and as we know the downturn in the economy has affected prices everywhere including real estate. So is the value of the rainy day fund tied to real estate assets? What is it tied to and how much is it really worth? Do we have the immediate access necessary to use the money available if we need to in an emergency?

One has to wonder.

Is this why Abramson will not use the rainy day fund to offset his supposed budget "crisis?" Is there no cash on hand as he says we have?

No one can give a definitive answer to this. No one has offered to show a savings account with the balance of the rainy day fund. Logic says this is just another smoke screen to appease us.

NO CAFR, NO PROOF of a Rainy day fund with a cash balance. What gives?

More importantly when do we get accountability. After all it is our money we deserve to know how it is spent and where it is at.

Your thoughts?