The City of Dunkirk is facing a $12.7 million fiscal shortfall next month. State and local officials have been working to find a solution, with two options floated. A hard financial control board like what Buffalo had in 2003, or a loan directly from the state of New York. The state senate voted for the latter, which has drawn some criticism.
The state-backed loan comes at an interest rate of 7.5%, with Dunkirk given 15 years to pay it back. The vote in the State Senate came down to party lines, with a senator from Brooklyn sponsoring it. That doesn’t sit well with the Republican who represents Dunkirk in Albany, State Senator George Borrello.
“As bad as the financial situation is, what's worse is that they have been unable to actually rectify anything," argued Borrello. "The city has has failed to meet the requirements of the Fiscal Recovery Act that myself and former Assemblyman Andy Goodell passed a year ago, which would have given the ability to bond for over $18 million but that required them to obviously meet the basic responsibilities."
Borrello and three Dunkirk city councilmembers were pushing for a financial control board. A state-appointed entity filled with various financial and business experts who could go out into the bond market at a lower interest rate and bring Dunkirk’s finances back up to par. It’s what happened to the City of Buffalo from 2003 to 2012.
“First and foremost, it would be made up of people whose full time job, at least the staff that they would would employ, would be to analyze the Dunkirk issues. They'd also be empowered to make some tough decisions that it appears the mayor is not willing to make," said Borrello. "And also it would get them on a better glide path. If you look at the City of Buffalo, as bad as that situation is in City of Buffalo right now, during the early days of their control board, when they were active, they actually made things a lot better."
This comes just months after the Dunkirk council voted to raise property taxes by 84%, a move they say was needed to offset the loss of NRG Energy and budgeting practices. The state has been investigating the city’s accounting, and it temporarily closed the Dunkirk Treasurer’s office in March. Borrello said this all comes at the expense of Dunkirk’s most vulnerable residents.
“This is not about politics. It's about an incredibly poor community filled with minorities," he said. "20% of which are senior citizens, 20% of those households don't speak English in their home, and we're going to saddle them with essentially a high interest payday loan with no ability to pay it back.”
Dunkirk Mayor Kate Wdowiasz was unable to speak to BTPM NPR before time of publishing.
