ADVERTISEMENT

The control board that offers advice on Buffalo’s finances has voluntarily cut much of its own authority as the city’s fiscal strength improves. However, its budget is moving in the opposite direction.

In fact, in a few years, it will become a $1 million panel.

The Buffalo Fiscal Stability Authority went into advisory status July 1, 2012, meaning it no longer has the authority to impose a wage freeze or approve labor contracts.

But the board is projecting a 30 percent increase in its expenses from the time it went into advisory status until 2017, when expenses will break $1 million. City taxpayers pick up the tab.

The board explains that the large increase is due partially to a vacant position – which created an artificially low expenditure for 2012 – that since has been filled.

But the board’s budget is projected to continue to grow to about $1 million by 2017, with roughly 60 percent attributed to salaries and benefits.

If that trend continues – and control board officials said they don’t anticipate any reason why it won’t – city taxpayers will continue to pay at least $1 million a year to fund the board until June 30, 2037, the date the board is scheduled to expire.

The board’s expenses have caught the eye of some in City Hall.

“My question is, how many years is this going to go on, how many millions of dollars are we going to spend on this advisory status?” asked Lovejoy Council Member Richard A. Fontana. “We were all under the impression ... once it did go advisory, it would be a much more streamlined situation, where it wouldn’t cost the amount of money that it costs per year.”

At the height of its powers, and in the thick of costly legal fights with unions, the control board’s total expenses topped $1 million, and fell as legal expenses decreased. Actual expenses in 2013 were $717,096.

The board maintains that since it was created in 2003, it has saved the city more than $398.5 million through its actions and powers, such as by imposing wage freezes and borrowing at lower interest rates than the city could borrow.

And even in advisory status, according to state law, the board’s staff must be able to analyze the finances of the city, the School Board, the Buffalo Municipal Housing Authority, the Buffalo Urban Renewal Agency and the Joint Schools Construction Board. Using that analysis, the board is required to reimpose a “control” status if the financial situation of any of those entities becomes too dire.

This possibility was mentioned recently because of the finances of the city school district. If the board voted to return to a control period, it would have to do that for all entities, unless state law is changed.

“Our level of work here has not decreased,” said control board Executive Director Jeanette M. Mongold-Robe, noting the financial analyses her staff continues to perform.

But there are significant changes in the board’s role when it is in advisory status.

Currently, the board is no longer responsible for approving all labor contracts and contracts worth more than $50,000 and cannot impose wage or hiring freezes. It also does not have to approve the city’s borrowing or its financial plans, though it does review and comment on them. The board also certifies revenues included in financial plans.

The board has five full-time staff members, down from seven when the panel was convened in 2003. The downsizing happened after two people left the board in 2008 and were not replaced in anticipation of the control board’s transition to advisory status, which happened four years later.

There have been no other staff cuts since then.

In addition to a nine-member volunteer board of directors, the board employs an executive director whose salary is $104,040, with health and pension benefits totalling $31,960; a controller, two budget analysts and an administrative assistant.

In contrast, the city’s elected comptroller, Mark J.F. Schroeder, makes $88,412, and the Brown administration’s top finance official, Donna J. Estrich, makes $119,239.

First Deputy Mayor Steven M. Casey asked Estrich why the control board’s budget wasn’t reduced when it went to advisory mode.

“Do you think that makes sense?” Casey asked during a December meeting of CitiStat, the administration’s accountability panel.

Estrich said there isn’t anything the city can do about the control board’s staffing level or its budget.

“Being an advisory control board, I don’t believe we should have that many people over there,” she said.

Estrich explained that the control board submits its budget to the city, and the city pays. The money comes directly out of the sales tax that is due the city.

The Brown administration, which has saved money by leaving many positions unfilled, is without a budget director since Estrich was promoted from that position to commissioner of administration, finance, policy and urban affairs in December 2012.

As commissioner, Estrich oversees two budget analysts, who handle finances for the city. The School Board, Housing Authority and BURA have budget staff of their own.

Fontana acknowledged the work the control board has done to improve city finances and said that even in advisory status, it requires some funding.

“But to go from full bore to advisory and not have a substantial cut in the budget is something I’ve always questioned,” he said.

The board should move immediately from its offices in the Market Arcade Building, which it rents for about $44,000 per year from BURA, into City Hall in order to save money, he said.

But Mongold-Robe, the panel’s executive director, said the board must be able to maintain its independence and its own computer system.

email: jterreri@buffnews.com