Buffalo's fiscal watchdog is urging Gov. Eliot L. Spitzer to sign state legislation that would set the stage for making the city's control board a "soft" advisory panel by next summer.
City Comptroller Andrew A. SanFilippo sent Spitzer a letter warning that uncertainty over how long the control board will retain its sweeping powers is hindering efforts to negotiate contracts with city unions.
SanFilippo stressed that the Buffalo Fiscal Stability Authority has done an "outstanding job" in helping to improve city finances.
"However, because of the lengthy wage freeze imposed on city employees, there is a continuing backlash and strong level of distrust against the control board that is hindering labor progress," SanFilippo told Spitzer.
Some union leaders said they're worried that even if city and labor negotiators can come to terms on new contracts, there's no guarantee that the control board would go along with them.
The wage freeze, which has been in effect since April 2004, ended Sunday. The control board voted to lift the freeze last month.
But SanFilippo said the lifting was "very limited," because the state has determined that employees who missed out on several salary step increases will only move up one notch on the pay tier.
"[The lifting of the freeze] has done little to win back the trust of workers to negotiate in good faith," SanFilippo said.
But Spitzer said it will take much convincing before he take steps to weaken the control board's powers. The governor said the panel should retain all its clout until the city hammers out long-term agreements with its unions.
"Until we see that, I'm going to be hard-pressed to support efforts to diminish the authority of the control board," Spitzer said in an interview with The Buffalo News.
SanFilippo agrees that reaching affordable contract settlements is a key step toward ensuring Buffalo's long-term fiscal stability. But he said he thinks an amendment to the bill more specifically defining the control period that sailed through the State Legislature two weeks ago adequately addresses the concerns.
"Two recent ratings upgrades on Wall Street and record surpluses tell the tale of a city on the rebound," SanFilippo wrote in his letter to Spitzer. "It is my feeling that the final piece of the recovery puzzle is to become independent of the control board."
Under state law, the control board goes from "hard" to advisory once the city balances three consecutive budgets. This goal will be achieved if the new budget that took effect Sunday remains in balance for the next 12 months.
But the other test is that the city be able to stand on its own without receiving extraordinary help from the control board, including tapping into the panel's ability to borrow money. Earlier this year, the control board did borrow on behalf of the city to pay for capital projects. But Mayor Byron W. Brown said the panel did so without the city requesting such help. Brown insisted Buffalo could have borrowed on its own.
The pending legislation includes a clause stating that if there is a "substantial likelihood" the city could have borrowed the money -- as determined by the city and state comptroller -- then it would count as a condition in which the control board's powers can be lessened.