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Ogdensburg must change financial course before fund balance runs dry, city manager warns

Posted 5/27/16

By JIMMY LAWTON OGDENSBURG – If Ogdensburg doesn’t alter its financial course soon, the city’s fund balance will be drained within two years, according to City Manager Sarah Purdy. Purdy …

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Ogdensburg must change financial course before fund balance runs dry, city manager warns

Posted

By JIMMY LAWTON

OGDENSBURG – If Ogdensburg doesn’t alter its financial course soon, the city’s fund balance will be drained within two years, according to City Manager Sarah Purdy.

Purdy reiterated outgoing City Comptroller Philip Cosmo’s message that the city’s fund balance is already dangerously low.

She said Ogdensburg has about $912,921 on hand to cover cash flow needs related to the general fund, which is largest portion of the city budget.

A report by Purdy shows that in 2014 the city had $2.7 million in the fund, but used $1.45 million to hold property taxes below the cap in 2015.

In the 2016 budget the city allocated $419,499 to offset a potential levy increase.

Purdy said if the city continues to allocate significant portions of the quickly dwindling fund balance to off set tax increases the city’s cash on hand will be depleted in two years.

“Unless we change status quo general fund balance will be gone by 2019,” she said.

A major problem for Ogdensburg is that 59 percent of all property in Ogdensburg is tax exempt.

“That means 41 percent of the property is being taxed to take care of services for all city property,” she said.

It’s a problem the city has faced for years, but Purdy said it’s possible that Ogdensburg could establish PILOT programs with some of the non-taxable entities, which could help the city, reduce the tax burden. She said similar deals have been worked out in Syracuse.

Purdy said 70 percent of general fund spending goes to wages and benefits. She said the city must work with its unions to come up with contracts that the city can actually afford. Other potential cost saving measures Purdy recommended investigating were not refilling positions, reconfiguring jobs, deferring equipment purchases, reducing frequency of services and analyzing health insurance.

Purdy said that the upcoming budget season will be crucial to ensuring the city’s cash flow situation doesn’t fall to levels where its forced to borrow money just to get by.