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NYSAC Unveils Looming County Fiscal Crisis
The New York State Association of Counties (NYSAC) today updated projections that reveal an unsustainable county outyear fiscal gap. County leaders are signaling the alarm that looming multi-billion dollar budget deficits are being caused by State mandated programs, and therefore cannot be addressed solely through actions initiated locally.
“Based on current trends, county expenditures will continue to outpace revenues unless there is continued and meaningful mandate relief provided by the State,” said NYSAC President Edward A. Diana, the Orange County Executive.
Locally, Essex County Supervisors are dealing with an impending deficit which will require either a large increase to the tax base, or a large reduction to expenditures, unfortunately, according to North Elba Supervisor Robi Politi, the Horace Nye Nursing Home sale won’t be consummated for another county budget year and they’ll have to continue to assume those expenses, along with the other mandated requirements of the state..
According to Diana, Counties haven’t seen this type of fiscal shortfall in any of our lifetimes. And he continues by saying this deficit is forcing counties to make incredibly difficult decisions. Leaders at the State level are acknowledging this issue.. In fact, despite his relatively positive report yesterday, DiNapoli says the State’s early warning system is being implemented and it’s designed to help municipalities predict the oncoming crisis not only for Essex and Franklin Counties- but for counties across New York State..
In 2013, the county cost for just nine State-mandated programs will grow by $244 million, while available levy growth, under the State’s property tax cap, is $114 million. This leaves a gap of $130 million. This deficit does not include the general cost of inflation, salaries, health insurance, fuel, and the countless other responsibilities of county governments.
NYSAC warns that this equation is a formula for failure and counties cannot continue to operate under this model.
“We haven’t seen this type of fiscal shortfall in our lifetimes. This deficit is forcing counties to make incredibly difficult decisions. Local leaders are draining down their reserves and gutting local programs to balance their 2013 budgets,” said NYSAC President Diana. “Very soon there will be nothing left to cut. At the same time, our costs are pre-programmed by the State and will automatically rise.”
This local fiscal cliff has been acknowledged and validated by State leaders. Last month, State Comptroller Thomas DiNapoli, the State’s chief auditor of local governments, released an early warning system designed to help municipalities predict their oncoming crisis.
Additionally, Governor Andrew M. Cuomo and State Lawmakers recognized the severity of the problem and took steps to address outyear costs through substantial pension and Medicaid reforms. But more needs to be done to proactively manage this looming gap.
“The fact remains that we are on an unsustainable trajectory in the way we pay for State programs delivered locally. Unless and until there is a serious collaborative effort to enact mandate relief, essential local programs and services will be sacrificed,” said NYSAC Executive Director Stephen J. Acquario.
In an effort to continue to prime lawmakers to enact mandate relief, last week NYSAC released a new report: “A Roadmap to Mandate Relief: How the State can reduce property taxes.” The report contains 51 recommendations for reducing the cost of government at both the State and county levels.