Some facts, observations, and heard-on-the-streets, including impending financial crisis and Buffalo Fiscal Stability Authority

We are in a bit of a lull in local political activities with the special congressional election behind us and only one primary on the horizon in June.  On the other hand, there are some important governmental developments that are worth watching.

Here are some facts, observations, and heard-on-the-streets:

The date of this post’s publication, May 21, is the day when school district voters outside of Buffalo get the chance to express their opinions about next year’s budget, capital borrowing, and who will sit on the district boards.  The ones that have attracted the most attention are experiencing budget difficulties, notably in West Seneca and Hamburg.  The budgets may be approved for no other reason than because the imposition of a contingency budget would lead to more cuts.

I reported last week on the impending financial crisis that is facing the City of Buffalo.  There are no good options.  Taxes and fees are climbing in the 2024-2025 budget and the budget problems will get worse over the next three years.

The Buffalo Fiscal Stability Authority met last week to review the city’s budget and four-year plan.  The meeting highlighted significant problems in both documents:

“The 2024-25 Proposed Budget is balanced with the use of an estimated $40.7 million in one-time resources and an additional $11.5 – $19.0 million in uncertain revenues. The one-time resources consist of $19.8 million of ARPA revenue replacement funds, an additional $6.0 million of ARPA to address prior-year arrears, and $14.9 million of Unassigned Fund Balance.”

“The Financial Plan contains $40.6 million of nonrecurring, one-time revenues used to support recurring expenditures, including ARPA revenue replacement funds. This indicates a structural imbalance as such funding is not sustainable. Future revenues will need to be generated to replace such one-time sources or expenditures decreased.”

“Total unsupported revenue over the four-year Financial Plan ranges from $101.8 to $131.3 million.”

“Various revenues and expenditures will continue to require close monitoring… These revenue lines include parking meter fees, parking tags, fines and fees, cannabis tax, occupancy tax, tribal state compact and traffic violation fines.”

“Combined overtime for the police, fire, and public works departments is $2.8 million…  Based on recent history, overtime likely continues to be underestimated within the police and fire departments.”

The Authority punted on the city’s proposals and gave the administration two weeks to see if they could come up with better estimates on the questionable revenue and expense items.

The city is projecting $20.1 million in anticipated revenues from an Occupancy Tax over the next four years, including $4.2 million in 2024-2025.  The thing is, there is no authority to impose such a tax; it needs state legislative approval.  An occupancy tax directed at property owners was briefly imposed by the city in the early 1970’s but was quickly repealed following a public revolt.  There has been a county hotel occupancy tax in place since 1975 supporting tourism and convention operations; estimated revenue for that tax is $13 million in 2024.

Democratic and Republican Erie County legislators are debating a proposed law that would change an Erie County Charter requirement for a two-thirds vote to approve additional sales tax.  The Dems want to permit approval of a continuation of the previously established additional 1.75 percent of the tax by a simple majority, reserving a two-thirds vote requirement for any new form of county tax. 

The county has become heavily dependent on the 1.75 percent of the tax that was added to the base of three percent many years ago.  The county collects $398 million annually from the 1.75 percent in sales tax charges and shares $12.5 million with local governments.  That portion of the sales tax is 20 percent higher than the annual tax levy.  A public referendum would be required to approve a change in the Charter.

I was the Democratic chief of staff at the Legislature in the 1970’s.  I wrote the two-thirds vote requirement legislation.  Legislator Stanley Zagora sponsored the bill.  It was passed in 1978 when the Republicans ran the Legislature and Ned Regan was County Executive.  The referendum approving the law passed overwhelmingly in November 1978.

The Town Boards of Cheektowaga and Hamburg have compromised on their bonding and use of reserves financing plans for some infrastructure projects.  The debate is not over but at least it is a start.

The Republican candidate for Congress in NY26, Anthony Marecki, still has not created a required Federal Election Commission committee.

The Republican primary in the 147th Assembly District is between incumbent David DiPietro and Mitch Martin.  DiPietro has been flooding mailboxes with mailers.  He has a financial advantage at the moment, having reported a balance of $136,782 in his campaign account as of January 15th. 

Martin has raised approximately $35,600 thus far.  He has applied for matching funding under the state’s new Public Campaign Financing Program (PCFP) but has not yet received any money.

At their meeting two weeks ago the PCFP Board approved the first payments to candidates totaling $3.6 million to 37 candidates.  The only local state legislative candidate among the ten who have applied for PCFP funding is state Senate candidate and current Erie County Legislature Chair April Baskin.  So far she has received $3,343.

Assemblymember Monica Wallace makes some good arguments in a recent Buffalo News “Another View” article suggesting that there are better uses for the $100 million in state funds that has been budgeted for the program.  She notes ways that candidates can parlay non-public funding in a campaign, somewhat defeating the intentions of the law, and cites examples of the alleged fraud that has occurred in New York City’s public funding plan.  The New York plan was a model for the state’s program.

Jim Heaney in his Investigative Post Newsletter wrote recently about the poor coverage of the Buffalo Bisons’ season by the Buffalo News.  Commentaries about the team appear occasionally but there are no game reports or box scores.  You have to hunt among the small print summaries to find the league standings or what the Bisons did – two days ago.  The Bisons are having a decent season thus far.  Perhaps there could be a couple fewer stories about some free agent defensive end the Bills might sign, freeing up some space in the paper for local baseball coverage.

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