Lockport Union-Sun & Journal Online

September 25, 2013

Layoffs eyed as city snags 'stressed' label

By Joyce M. Miles
Lockport Union-Sun & Journal

Lockport Union-Sun & Journal — One Locks Plaza is getting braced for a day of reckoning.

On Wednesday, the state comptroller's office added the City of Lockport to its running list of fiscally stressed municipalities, in the "moderately" stressed category.

Auditors from the comptroller's office have been at City Hall since Monday, examining 2012 and 2013 financial records and inquiring about the 2014 city budget process, which has been conducted wholly out of public view, for the first time in at least 10 years.

In the still-unfinished preliminary budget, some key appropriation lines showing employees' salaries and fringe benefits remain blank as the Tucker Administration continues contract talks with the police and firefighters unions — whose members comprise half of the city workforce.

With its resolve to not raise the tax rate still rock-solid, the Common Council's consideration of layoffs to balance the 2014 budget finally went public Wednesday night, as President Anne McCaffrey called an executive session to discuss them.

No decisions were made about the number or types of possible job cuts, McCaffrey said afterward — but she noted that a preliminary 2014 budget "gap" of at least $1 million exists and at this point, on paper at least, the gap cannot be closed without some job cuts.

Contracted budget adviser John Schiavone, of the Lumsden & McCormick accounting firm, is going back to city department heads a third time to see what non-personnel-related spending they could live without, but any additional savings wrung from them will pretty much be a drop in the bucket, Mayor Michael Tucker suggested.

The budget line showing $80,000-plus in city spending on the annual summertime Labatt Canal Concert Series — a line that Tucker has defended fiercely the past few years — has been reduced to $0.

"We've been kicking the can down the road. Every year, we've found a one-time revenue or one-time savings, such as (privatizing) garbage. No more," Tucker said.

Of the city's new "stressed" designation by the state, he said, "We're not broke, but we're getting to be in a bad-off way. ... We should have made job cuts last year. The (costs) that dog us the most — pensions, health care — are there and growing, year after year."

Because the preliminary budget is not complete, meaning there's not a document to show to the public yet, the Council will cancel the public hearing that it previously set for Oct. 9. The hearing will be rescheduled for Oct. 23 and the Council will adopt a final budget Oct. 30 — before the Nov. 5 election, in keeping with the spirit if not the letter of the city charter, Tucker said.

Meanwhile, the Council has agreed to show its in-the-works version of the budget to the state auditors while they're here conducting what the comptroller's office calls a two-week "expedited audit" of city financial records. It'll be looking for their "guidance on how to proceed" with the budget, McCaffrey said.

"If the state has ideas about what we should be recommending, I'm eager to hear what they are. They're the experts on local government," she said.

Effective this year, Comptroller Thomas P. DiNapoli established a statewide Fiscal Stress Monitoring System that scores municipalities based on their financial reports to the state for the previous fiscal year, and identifies some as "fiscally stressed" to a degree: significant, moderate or susceptible.

Only municipalities whose fiscal year ends Dec. 31 are monitored. The City of Lockport is one of 1,043 municipalities in the system — and one of 38 that's been identified as stressed to some degree. Erie County also was added to the moderately stressed list Wednesday.

Counties and cities are far more likely than towns to score as distressed, the comptroller's office noted. Statewide, nearly 25 percent of counties and 11 percent of cities are fiscally stressed compared to 2 percent of towns.

Common trends in stressed municipalities include upticks in poverty and unemployment, decreased state and federal funding, population loss and declining property values, according to the comptroller.

Total taxable property value in the City of Lockport decreased by $10 million from 2012 to 2013, McCaffrey noted.

The "stressed" designation isn't the worst or best label that the city could have. Coming on the heels of his administration's heretofore private struggle to balance a budget that assumes exploding expenses and no additional income, Tucker says he's viewing the designation as "an opportunity.

"It's a good pause for us: Take a good look at where we're going. It's a warning to us to get our house in order, and that's exactly what we're going to do," he said. "We're not on the 'extreme' list. We have a chance to do what we should have done already: Rightsize our government and make it fit with the taxes we collect."