Two prominent business leaders have resigned from Buffalo's control board, giving Gov. Eliot L. Spitzer greater ability to shape a panel that he insists will retain its powers until the city can sign long-term contracts with unions.
Brian J. Lipke stepped down as board chairman Wednesday, citing Buffalo's improving finances and pointing to added responsibilities at his "day job" as chairman and CEO of Gibraltar Industries.
And Robert G. Wilmers, chairman of M&T Bank, has also stepped down, The Buffalo News has learned. He has been a control board member since its inception in 2003 and had been considered one of the panel's most influential members.
The resignations come at about the same time as the departure of the control board's day-to-day executive director was announced. Dorothy A. Johnson is expected to leave that post soon. Johnson makes $110,000 a year, unlike Lipke, Wilmers and other board members, who serve as volunteers.
One day before Lipke's resignation, Spitzer reiterated his support for the continuation of a "hard" control board.
"I'm not going to diminish the capacity of the control board to do what needs to be done," Spitzer said in a meeting with reporters and editors of The News. "What I've said is that we need to lock in contracts."
Those labor agreements, Spitzer said, must include provisions that would allow the city to save money while also giving employees raises.
"That's the harsh reality," the governor said. "We've seen it with too many cities, where if we don't take that hard medicine, then recovery simply isn't possible, and the pressure on property taxes simply won't abate."
Lipke denied that his resignation had anything to do with a local push to diminish the panel's powers. Mayor Byron W. Brown, Common Council members, Comptroller Andrew A. SanFilippo and city unions have been lobbying for an early end to the active control board phase.
Lipke said that while there has been "some tension in the system," it played no role in his decision to step down from a post he has held since early 2005.
"I think tension in the system is a good thing," he said.
"Everybody is entitled to their opinion on how things should be, and I don't feel in any way that that had an impact on my decision."
Spitzer, in his meeting at The News, seemed to foreshadow the chairman's departure.
"He's done yeoman's work," Spitzer said of Lipke. "I can understand his desire, after a certain number of years, to say, 'Who needs this?' This is really a thankless job. At times, we all think our jobs are thankless. His is genuinely thankless. He's not paid to make unpopular decisions and then go downtown and have people throw epithets at him."
Wilmers informed Spitzer on May 31 that he did not wish to be reappointed when his term expired June 30, The News has learned. He could not be reached to comment Wednesday.
In a letter to the governor, Wilmers said "significant progress" has been made in helping to improve city finances. He said the board worked with the city in the first three years to generate $186.6 million in savings.
Lipke cited increasing surpluses, improved credit ratings and the control board's decision to lift a wage freeze effective July 1 as evidence of Buffalo's improving fiscal climate.
Nevertheless, both Wilmers and Lipke warned the city still faces major financial challenges. For one thing, Lipke noted Buffalo's reliance on state aid has increased since the control board was created in 2003.
"There are issues that still need to be addressed before Buffalo can claim true long-term fiscal stability," Lipke said.
Wilmers pointed to a continuing decline in Buffalo's population.
"These statistics show that Buffalo will have fewer and fewer residents to support a government that continues to grow increasingly expensive," Wilmers wrote, renewing his call for reforms. Before people support efforts to diminish the control board's powers, Lipke said, they should ask three questions: Do they believe the fiscal progress Buffalo made could have been achieved without a control board? Second, do they think future progress can be made if the board -- formally known as the Buffalo Fiscal Stability Authority -- goes into an advisory mode? "Third, why take the chance? It appears to me that the working relationship between the [control board] and the city . . . has worked. So I think everybody should ask the question, 'Why change it?' "
Philip Rumore, Buffalo Teachers Federation president and a control board critic, had a biting reaction to Wednesday's announcements.
"I wouldn't care if they all resigned, because we don't need a control board," he said.
Asked Tuesday if he thinks the control board might be crumbling under pressure, Spitzer said, "I don't think there's been any crumbling in terms of will or decisions." Meanwhile, Brown said Wednesday that he has urged Spitzer to sign state legislation that would pave the way for moving the control board into an advisory mode. In addition to naming replacements for Lipke and Wilmers, officials must fill three more seats on the nine-member board that expired June 30. Spitzer must reappoint or replace Anthony J. Colucci Jr. and Richard A. Stenhouse. State Comptroller Thomas P. DiNapoli must reappoint or replace Wade Norwood. Lipke said he expects board Vice Chairman Alair Townsend to serve as acting chairman until Spitzer makes a permanent appointment.
News staff reporters Phil Fairbanks and Patrick LaKamp contributed to this report.