In the current shaky economic environment, City of Buffalo officials have worked for years to maintain services without raising taxes that would give residents one more reason to leave the city.
That fiscal responsibility is reflected in Mayor Byron W. Brown’s latest budget proposal.
The city’s credit rating is the highest in its history, reflecting good fiscal management. That higher rating has saved the city and school district $62 million in interest costs in the last 16 months. Next year’s budget, which takes effect July 1, holds the line on residential property taxes and lowers commercial property taxes by 3.2 percent.
It is an election year for the mayor, and he will undoubtedly point to the city’s consistent fiscal stability in turbulent times. However, the continued use of surpluses to balance the budget is troubling to both the city comptroller and credit rating agencies. In addition, the budget relies on one-shot revenues that won’t be available for the next budget, which could present the mayor with tough choices to make.
To balance the $482.5 million budget for 2013-14, the city is relying on $12 million from surpluses, $12 million in state aid that was being held by the control board and $9.6 million from the city’s parking operations, including money that had been set aside to construct a new ramp.
The city is also saving money by putting hiring on hold as older employees retire. This move will cover about 50 positions in police, fire and public works. Consider that 86 percent of city spending is related directly to personnel, with the largest portion in police and fire. While the administration can work around the edges by delaying new hires, major savings in personnel would mean reducing services.
The budget holds city service fees flat and anticipates sales tax revenue will increase about 2 percent, growth the rest of the state is not seeing and that is attributable to our neighbors to the west.
Keep in mind that while property taxes haven’t gone up in a while, the new reassessment process will begin soon. That has the potential for big changes in individual tax bills.
Meanwhile, suggestions by the Common Council on ways to raise revenues by selling advertising on the backs of parking meter receipts and on garbage and recycling totes, along with an audit of street lights and a switch to energy-efficient LED lighting, are welcome and should be considered.
The administration has also filed its four-year economic plan, which relies to some extent on hopeful thinking.
Brown projects that the city will use $14 million in slot machine revenue from the Seneca Buffalo Creek Casino over three years beginning in 2014-15. However, no casino revenue is being distributed to the city because of the ongoing dispute between the Seneca Nation of Indians and the state account; there’s no guarantee that money will be there. In addition, an increase in property tax revenue and a 1 percent increase in state aid are optimistic.
However, overall the mayor’s budget plan represents continued good management of the city’s improving financial situation.