Comptroller’s Office says some face more ‘fiscal stress’
ALBANY–The office of State Comptroller Thomas DiNapoli has compiled profiles of villages statewide based on the “fiscal stress” each village faced in the last fiscal year. None of the four villages in the county were designated as facing or currently under fiscal stress, but their profiles vary substantially.
Kinderhook and Philmont were listed as having had the lowest stress factors, Valatie was higher, and Chatham confronted the most stress factors, though not enough for the comptroller to flag the village as in trouble.
All four villages have fiscal years that begin June 1 and end on May 31, so the dates for these profiles covers the period from June 2012 to May 2013, the last complete fiscal year for the county’s villages.
The score at which the Office of State Comptroller (OSC) considers a village under fiscal stress is 45%, and from there the OSC has three categories, or “designations.” The comptroller’s office defines fiscal stress for villages as having “low fund balances and poor cash position, chronic deficits and use of short-term debt to bridge cash flow gaps.”
The fiscal stress rating assigned to each village, expressed as a percentage in the OSC report, are:
The average score for “Medium Upstate Villages,” with populations between 1,000 and 3,000 was about 38%. The least serious of the OSC designations, “Susceptible to Fiscal Stress,” is set at a 45% rating.
The OSC website also advises readers that “This system measures the level of fiscal stress a municipality is facing, not its level of fiscal health. A municipality’s absence from the top three categories should not be viewed as substantiation of good financial condition by OSC.”
The full report is at http://www.osc.state.ny.us/localgov/fiscalmonitoring.
“My understanding is that our low fund balance is one of the areas where the village scores the most points,” Chatham Village Administrator Barbara Henry wrote in an email to the Columbia Paper. She continued, “Current village officials are well aware of this problem and with conservative budgeting expect that the village will be in an improved position next year.”
Ms. Henry cited a $27,000 reimbursement from a utilities audit, unspent contingency funds and revenue from the new Price Chopper supermarket now under construction that would improve village finances. She acknowledged that these funds “are all one-time sources of revenue” and said the mayor and village trustees would be looking at next year’s budget “very carefully.”
The OSC did not release an overall statewide average score for the 535 villages it looked at, though the office did send a chart to Valatie Mayor Diane Argyle showing the average for villages in the Capital region was about 33%.
Sixteen villages in the state have different fiscal years so their information was not recorded for this report, and small number of villages did not file data in time for the report. The Villages of Suffern in Rockland County had the highest stress rating at 86.7%, which put it in the comptrollers “”Significant Stress” category. The only nearby village designated in the “Susceptible to Fiscal Stress” category was Red Hook in Dutchess County at 49.2%.
Valatie Mayor Argyle said in a phone interview this week that Valatie was below the average for the area, but added, “I do know that we have to be careful with how we spend our money.”
In addition to the fiscal stress rating, the OSC report includes what are called “environmental” indicators of fiscal stress. The OSC website says that while the financial indicators “which evaluate budgetary solvency,” the environmental indicators “capture those circumstances and trends that are largely outside the locality’s control but which have a bearing on its revenue raising capabilities as well as its demand for and/or mix of services.” Only the scores calculated using financial indicators determine the percentage on the fiscal stress list.
The environmental indicators include population, age, poverty, property values, employment base, intergovernmental revenues, constitutional tax limit and sales tax review.
On the environmental factors profiles Kinderhook received was 23.8%, Philmont 18.8%, Chatham 12.5% and Valatie 2.5%, with the lower scores meaning fewer fiscal environment stress factors.
The Comptroller said in a press release, “Although the number of villages designated as fiscally stressed is small, village officials across the state must be on alert. Moving forward, the drivers of fiscal stress will continue to hamper villages in many of the same ways it does our larger municipalities. I continue to emphasize to local officials that the best way their community can avoid falling into fiscal stress is through sensible budgeting and careful long-term planning.”
To contact report Emilia Teasdale email .