In a bipartisan move, the Erie County Legislature on Thursday urged County Executive Mark C. Poloncarz to take steps that would allow the Erie County Fiscal Stability Authority to continue to conduct short-term capital borrowing on the county’s behalf.
The unanimously approved resolution asks the county executive to issue a “declaration of need” to that effect, but it does not legally compel the county executive to comply.
“In the years past, this current county executive, when he was comptroller, said that he supports borrowing through whatever is the cheaper method for the taxpayers,” said Majority Leader Joseph C. Lorigo, C-West Seneca. “Since he’s become county executive, the only thing he supports is borrowing through the county itself.”
Both control board and administration officials have estimated that the county could save nearly $250,000 in debt financing costs by taking advantage of the control board’s superior bond rating. However, a spokesman for Poloncarz said there could be long-term savings and other benefits for the county to begin increasing its independence from the control board.
“The county executive believes there is an intrinsic value to the county borrowing on its own and it’s a matter opinion as to what the cash value benefit of that is,” said Mark Cornell, a spokesman for the county executive.
At a news conference last month, Poloncarz revealed that he had been in talks with County Comptroller Stefan I. Mychajliw about a plan to have the county begin borrowing on its own for road repair and reconstruction projects.
At the time, Poloncarz noted that Buffalo has been borrowing on its own for about five years after formerly relying on a control board. Since then, he said, the city has seen its bond rating increase. Likewise, Poloncarz said, the county has an opportunity to start demonstrating its capacity to borrow.
Meanwhile, Mychajliw is convinced that for now, at least, the county is better off borrowing through the control board. However, the comptroller has agreed to issue requests for proposals for underwriters for the county’s capital bonds and revenue anticipation notes.
“We’ll find out who’s cheaper by having an open, honest and transparent process,” Mychajliw said. “Anyone can bid on this and we’ll find out who’s cheapest ... It’s the only way to determine who is going to be cheaper.”
Cornell on Thursday said it makes sense for the county executive to wait until those numbers come in and then make a decision. However, Mychajliw said issuing a declaration of need to borrow through the control board would not stymie the county executive in any way or compel him to borrow through the control board. Instead, it would just provide him the option.
Meanwhile, Minority Leader Betty Jean Grant, D-Buffalo, on Thursday attempted to introduce an amendment to the majority caucus’ resolution explicitly stating that the Legislature would support whichever was cheaper with regard to the county borrowing on its own or through the control board. Ultimately, she voted with the majority.