By RUSS OLIVO

Officials in the already-cash-strapped communities of Woonsocket and Pawtucket are reacting to Gov. Donald Carcieri's proposal for another round of massive, mid-year aid cuts with dire predictions and disbelief.

“We were on life support and Governor Carcieri pulled the plug,” said Pawtucket Mayor James E. Doyle. “I'll tell you what I'm going to do: if the proposal goes through without the legislature in some way altering it I'll just lock the doors. We'll be bankrupt by the end of the fiscal year.”
Woonsocket's Interim Finance Director Joel Mathews also said the governor's proposal could push the city off a financial cliff. Already struggling with large deficits, vanishing liquidity and plummeting bond ratings, Woonsocket may not be able to count on more short-term borrowing to make up for the cuts, Mathews said.
Even before the governor's announcement, Mathews said the city envisioned short term loans of $9 million by the end of next month, including $3.5 million in borrowing needed to meet routine debts, including payrolls. Mathews said he has doubts about the city's ability to borrow $5 million to fill the  revenue hole the governor's cuts would cause.
“We have limitations on how much we can can borrow,” said Mathews. “If we have to go out and borrow and additional $5 million I would question whether a bank would  lend that kind of money to the city and if they do not that puts us in an insolvent situation.”
The officials were reacting to Carcieri's proposals this week to eliminate $125 million in aid to school districts and phase out some $65 million in motor vehicle excise tax reimbursements to cities and towns – all part of his plan to close a $220 million gap in the state budget.  The combined hit for Pawtucket comes to about $8.2 million, including $3.2 million for schools. Woonsocket would absorb a loss of about $5 million, including $2.3 million for schools.
So it's deja vu all over again for Pawtucket and Woonsocket, which resorted to a frenzy of eleventh-hour strategies in attempts to cope with similar mid-year cuts initiated by Carcieri last fiscal year. Included in the mix: Job cuts, new fees and property taxes, reduced services and hard-fought givebacks on wages and benefits from municipal employees unions.
Now officials say the well is all but dry. While there's little question community leaders will looking to cinch fiscal belts even tighter, they say it's unrealistic to think they'll be able to eke enough savings out of their stretched-thin budgets to compensate for cuts of the magnitude Carcieri envisions.
“I'm not sure it's even possible to find $5 million worth of cuts within one half of one fiscal year,” said Woonsocket City Council President John F. Ward. “We could revisit contracts, salaries and the amount of money we pay people but I don't think we're going to find $5 million lying around. There's not enough lying around for us to save without raising taxes.”
Pawtucket raised taxes about 5 percent last year – Woonsocket slightly less. Still, both were looking at multi-million-dollar shortfalls even before Carcieri proposed the additional cuts. Doyle said Pawtucket could be $10 million in the hole by the end of the fiscal year if Carcieri's proposal comes to pass, including $4 million from a School Department Caruolo lawsuit that is “on the launching pad.” Woonsocket projects a deficit in the range of $7 million, about half of which was discovered to have been incurred on the municipal side only days ago, as Mayor Leo T. Fontaine transitioned into office for the first time.
While  more cuts and tax hikes are probably inevitable, Doyle said he's uncertain whether they can keep Pawtucket from becoming insolvent.
“Either one of two things will happen, supplemental tax bills or if you don't do that, make layoffs or cut services to the point where it would be impossible to keep on functioning,” he said. “We already laid off 48 people and we're presently negotiating for furlough days that would result in the equivalent of a 4.6 percent pay cut. There's a myriad of things that have been done already. I just don't see us being able to go anywhere else.”
Fontaine couldn't be reached yesterday, but Mathews, too, envisions Woonsocket being forced to seek another round of tax hikes from a tapped-out citizenry. Mathews said it was absurd of anyone in state government to suggest, as Carcieri's aides have, that the governor's proposal would not trigger a new round of property tax hikes.
“My first reaction is one of disbelief that that anybody at the state level thinks the city of Woonsocket can come up with $5 million without raising property taxes in the equivalent amount,” he said.
Ward said it would be more fair for the governor to restructure the income tax to plug the state's budget hole. Ward said a new round of property taxes will force some residents out of their homes. Resurrecting auto taxes on cars worth $6,000 or less will also place new burdens on those least capable of shouldering them – often the elderly, who drive inexpensive vehicles because those are the only ones they can afford.
A common criticism of the Carcieri administration from the city officials came over its failure, for two years running, to present a realistic budget that did not force localities to scramble for mid-year givebacks. Municipalities do not have the flexibility to compensate for last-ditch cuts as quickly as they need to be made to balance budgets by year's end. Negotiating with unions for givebacks, raising taxes, passing legislation to impose new fees – it all takes more time than the governor is giving them, they say.
School officials were just as taken aback by the swiftness of the cuts as officials on the municipal side. Woonsocket School Committee Chairman Marc Dubois said there is no place left to cut in the district's $62 million budget to squeeze out another $2.3 million.
“We're barebones now,” he said. “All of our teachers have 25 students per classroom, or very close to that. That's the max allowed by contract, but even without the contract common sense says one teacher alone with 25 students, you really don't want to go more than that.”
The district could shrink extracurricular programs more than it already has, but even if it eliminated music and sports at Woonsocket High School, the savings would amount to a fraction of what is needed.
“The money you save is just a drop in the bucket and some of these programs are the only reason kids are staying in school,” he said.