NIAGARA FALLS – The public has had a chance to pore over Mayor Paul A. Dyster’s 2013 budget, and even with a New York Power Authority deal that would plug the budget hole, residents don’t like what they see.

Packing Council Chambers on Tuesday night to protest proposed layoffs and an 8 percent tax hike, residents said the city’s financial problems were caused by irresponsible spending and years of improperly balanced budgets.

Those failures, they said, need to be addressed now – without temporary funds from the Power Authority or Seneca Nation casino revenues that may never come.

“Enough with the overspending, enough with the high taxes, and enough with the irresponsibility,” said resident Joe Swartz, who plans to run for City Council next year. “On behalf of the citizens of Niagara Falls, we’ve had enough, and it’s time for a change.”

Residents said more savings need to be found in Dyster’s proposed $96 million budget before layoffs become a reality. They said excessive overtime pay, holiday pay and raises for exempt employees need to be scrutinized.

“They deserve it, but we’re at a desperate point here,” said Ron Anderluh, president of the Niagara Street Business & Professional Association. “How can they give out raises at this hand and then lay off people at this hand? We need a temporary freeze for hourly raises until we get this thing settled,” he said, drawing applause.

More measures need to be exhausted before the administration comes to the public to propose a tax hike, others said, noting that much of the city’s population depends on Social Security or public assistance.

“Everyone has got to have skin in this game, not just me where I’m expected to pay higher taxes,” said resident Kathleen Lloyd. “That’s not right. The audacity to come to the taxpayers for the irresponsible spending is unbelievable.

“Please fight for us,” she urged the Council. “Fight for everybody like me, and everyone else in here who is just getting by. Learn to live within your means.”

The public took issue with the idea that the budget crisis was caused solely by the state’s dispute with the Seneca Nation of Indians, which has withheld about $60 million in revenues garnered from its downtown casino.

The Senecas have withheld the money because they feel the state violated its gambling exclusivity rights when it allowed racetrack casinos in Batavia, Hamburg and Canandaigua.

The city should have budgeted those revenues more conservatively, they said, and should not have used the money for operating expenses or large, multi-year projects.

“It’s a percentage of money that you may get, so to ever consider that money as operating revenue, that’s a little short-sighted,” said resident Ed Battaglia. “What happens if the casino burns down tomorrow?”

They also said the city – which has spent down its surplus fund as it awaits an end to the casino dispute in arbitration – should not budget for casino revenues it doesn’t have. Dyster has budgeted $7 million in expected revenue for next year.

“I’m a penny-pincher. I’m not about to spend something until I have the money, and I want you to treat our budget the same way,” said resident Donald Supon. “Get the money first, then spend.”

Most speakers also objected to the city’s plan to accept more than $13 million in funds from the state Power Authority to close the budget gap. That money was designed to be paid out over a 50-year term for capital improvements, not used for operating expenses.

“That’s like taking the seed corn from next year’s crop and eating it now and having nothing for later,” said Battaglia.

Dyster contends that the city budgeted conservatively enough to build up a $20 million surplus fund, which is now depleted, and that the main expense paid by the casino revenues each year is a more than $4 million debt payment on the city’s police station – which was mandated by the state and decided before he took office. Otherwise, he said, the city has treated the revenues as “non-recurring.”

The Council plans to make cuts to Dyster’s budget, and leaders met with the mayor Wednesday afternoon to find a spending compromise. Council leaders expect an announcement on a potential deal next week.