Recalling a bleak time in Amsterdam’s history when city residents rallied to bring in new businesses to replace the outgoing Bigelow-Sanford carpet manufacturer, Mayor Michael Cinquanti drew a parallel to the city’s current fiscal problems in his state of the city address today, asserting that “out of crisis grows opportunity.”
According to the latest audit of the city’s 2017-2018 finances, funds with deficits totaled $8.3 million. The most recent annual update document filed with New York State for the 2018-2019 fiscal year put the total of all funds with deficits at approximately $7.3 million, but those figures have not yet been audited.
Cinquanti said that during his first week in office this month, he met with the deputy controller of New York State and was introduced to the state staff members who will be working on certifying the exact amount of the deficit. Once the amount is certified, the city can proceed with deficit borrowing as well as borrowing for high priority capital projects such as those included in the Downtown Revitalization Initiative grant, the reconstruction of Church Street, and wastewater system fixes and enhancements.
“There is a possibility that repayments or portions of [the deficit] could be forgiven or deferred and as a result, the city would not need to borrow the entire certified amount,” he said.
According to Cinquanti, the cost to service the deficit financing could be anywhere from $1 million to $1.5 million per year over a ten-year period.
“Where’s this money coming from? There are only two sources. Generating more revenues or cutting existing expenses,” he explained.
Citing his limited time in office so far, Cinquanti said he was not yet ready to identify specific budget line item changes yet, but said his approach will be to make up 60% of the amount ($600,000 to $900,000) through expense cuts, and 40% of the amount ($400,000 to $600,000) in revenue increases.
“I as your mayor must lead the way, not just by example but also by action and most importantly by results,” said Cinquanti.
As one example, he cited a recent action to transfer Michelle Jackson from her position in the Tourism, Marketing, and Recreation Department to the position of administrative assistant in the mayor’s office, leaving the former position vacant, as a move that will save approximately $50,000 per year.
He also said that bringing the prosecution of code enforcement cases back under the duties of the corporation counsel, rather than to a contractor, will save approximately $8,000 per year.
During a recent meeting with representatives of DePaul Properties Inc, a company which is planning a 60-unit residential project on East Main Street, Cinquanti said that they agreed to demolish an extra building owned by the city, which could save $40,000 to $50,000.
On the revenue side, Cinquanti credited Chief Water Plant Operator Randy Gardinier with an idea to sell carbon exchange credits based on the city’s Glen Wild watershed property, which may generate $75,000 per year.
In preparation for the next budget, Cinquanti said he has encouraged department heads to look for cost savings and new revenues.
“I have instructed them to do what I am doing – treat every line item of their department’s budget as an opportunity to improve the cost effectiveness of their operation. And I urged them not to do this alone, but to include those employees within their department who are proven problem solvers,” he said.
Cinquanti said that he is committed to working closely with the state’s comptroller’s office in all aspects of the city’s finances, including reviewing the city’s financial management, record keeping procedures, bonding strategies, and borrowing decisions, making sure that the office concurs with each move.
Ending on a positive note, Cinquanti concluded his address saying, “Although the fiscal state of our city may not be as strong as we’d like it, the heart and determination of selfless people committed to helping Amsterdam convert our fiscal distress into fiscal stability has never been stronger.”