By Eileen Buckley
Buffalo, NY – The state's top fiscal watchdog says Buffalo has become too dependent on state aid and has no reserve funds to dig out of deep finanical debt. State Comptroller Alan Hevesi is asking the state Legislature to approval a financial control board for the city.
Projecting a city deficit of close to $127 million dollars by the fiscal year 2006-2007, Hevesi is calling for a "Buffalo Oversight Recovery Board." It would be much like the boards that assisted New York City, Yonkers and Troy.
Hevesi says while the Mayor and Common Council would maintain governing power, spending of more than $50,000 or new contracts would need board approval.
"After a period of time, if the city of Buffalo meets some benchmarks -- that is-- no deficits, balanced budget, able to market debt, able to access to capital markets, then the character of this board changes into a fiscal monitor," Hevesi said.
Hevesi says the financial board is the only way to stop structural deficits. He says it's a chance to merge some government services and create new city revenues. Hevesi says Buffalo can no longer rely on the state for assistance. Mayor Masiello agrees, and actually told reporters he's "excited" about a control board. The mayor says it's not a "black eye" for the city and believes it's the only way fix financial problems.
"We realize we need help," Masiello said. "I'm not going to be the leader of this city and tell everyone I don't want this. We can't get it done, or we could do it ourselves. We need help."
But under state law, the oversight board would not have the power to end current union contracts, such as the newly ratified Buffalo Police contract that will allow the department to begin one-officer patrol cars. The board would, however, be allowed to freeze wages. But Hevesi says the city's fiscal crisis is "not about a police contract." Masiello says the city needs to deal with the expense side from pensions to health care costs "very aggressively." But he defended the police contract as a step forward.
"The benefits are for everyone," Masiello said. "We'll have more police on the streets, better use of them, better utilization of police during high crime times and in high crime areas, and it offers flexibility in management.
"I want to keep my eye on the prize and not worry about side agendas. If there are adjustments then we will talk about them, but right now, it is too premature to do that."
One of the city's union leaders attended Hevesi's announcement, Joe Foley, head of the Buffalo firefighters union. Foley says negotiating the firefighters contract is going to be very complicated for the city.
"It is very complicated, as we work to build new structures, new fire houses and re-engineer the entire department on how we do business," Foley said.
But while Foley says he's willing to work with the control board, he adds that he's not in favor of firefighter layoffs. Foley says contract talks with the city could resume as early as today.
Comptroller Hevesi says the board would also be able to examine the possibility of gaining a higher percentage of the county sales tax to raise revenues.
"I'm sympathetic to the notion that Buffalo get a higher percentage of the sales tax," Hevesi said. "I'm also not unmindful of the fact that there's a county executive who has his own budget to worry about, and his own needs for his constituents.
"There's got to be an agreement and we will look for a win-win situation."
County Executive Joel Giambra, who has been fighting for the merger of city and county services, says he's pleased with the the state recommendations. But County Comptroller Nancy Naples says if the county loses any of the extra one-percent sales tax that it currently does not share with the city, then the county would be forced to find more money.
"Do we raise property taxes? Do we diminish some services? All those things are possible," Naples said. "And are tough decisions our county executive and Legislature have to make. What I am looking for, of course, is a balanced budget."
Hevesi is recommending the board consist of seven voting members -- the Governor, state Comptroller, Senate Majority leader, Speaker of Assembly, Mayor of Buffalo, County Executive and City Comptroller, and five non-voting members -- from the Common Council, County legislature, business community, labor and city school district. But two school board leaders say the district representative should be allowed to vote. The district is dependent on the city -- receiving ten percent of its funding from Buffalo. However, Buffalo School Board Member Donald Van Every says he doesn't see the lack of a control board vote as a problem.
"We are not voting powers today in terms of revenue decisions the city makes for us," Van Every said. "The Common Council and Mayor makes those decisions, and we live with them. So our advisory role is satisfactory one. It continues as is right now."
If approved by the Legislature, the Governor would chair the board. But Pataki says it should go beyond political leadership and follow the model of a fiscal board in Nassau that relied on the expertise of financial experts. However, Hevesi insists that legislative politics has to be part of the board so those with the power and resources can make the needed changes.
Even as the state tries to free Buffalo from its financial dependency, the oversight board would come with a price tag. Hevesi says it would cost the state about $1.5 million per year to operate.