Buffalo Mayor Byron W. Brown's recent budget proposal continues to focus on the positive, with cuts in property tax levy and all-around fiscal stability, so much so that all three credit rating agencies saw fit to increase Buffalo's status into the A category. That has cut the city's borrowing costs about $1.6 million.
Brown proudly asserts: " Buffalo is investment ready" -- and that would seem to be the case. As the mayor recently pointed out, $750 million in construction is under way in downtown Buffalo, including the expanding Buffalo Niagara Medical Campus, waterfront revitalization and the governor's promise of $1 billion in state aid to attract new business and industry.
Indeed, the mayor has done an admirable job these past couple of terms in lifting the city out of its financial doldrums. The foundation for improvement was set in place at the end of the previous administration with the arrival of the Buffalo Fiscal Stability Authority.
But the Brown administration still had to work in achieving such milestones as improving its position regarding its constitutional taxing limit. In 2005, it was within 8 percent of that limit; today, with a 32 percent window, it has more breathing room. Still, room for revenue growth is limited by the state property tax cap and there are few recurring revenues that can create any significant growth. Clearly, there are challenges ahead.
The $482.6 million spending plan holds the line on the residential property tax rate and cuts the commercial rate by 8.5 percent, and includes no increases of the much maligned garbage user fee. Water rates will increase by 6 percent starting July 1.
It's no wonder that the mayor is enthusiastic when describing his plan.
Buffalo is under the same pressures faced by other municipalities, with higher gasoline prices, increases in the costs of employee pensions and fringe benefits. But the city has weathered thunderous financial storms much better than its peers. In that regard, the timing of the control board's creation has often been referenced as fortuitous since it forced the city to tighten its belt.
Still, concerns raised by City Comptroller Mark J.F. Schroeder are worth considering.
Schroeder, whose office considers the mayor's recommended budget to be adequate, raises questions about the four-year plan and the city's ability to generate significant revenues to cover anticipated expenditures going forward. New York State has its own fiscal worries, as the comptroller pointed out, and the national economy makes daily headlines. And there is the tax cap and a limited ability to raise property taxes with very few recurring revenues that can generate any significant growth.
The comptroller has proposed an amendment to the City Charter that would require annual four-year financial plans, as well as implementation of policies to protect the city's fund balance, including establishing appropriate uses for the "rainy day" fund. The comptroller is simply trying to codify some of the fiscal oversight duties currently employed by the control board.
For now, the mayor's budget plan represents a fiscal conservatism that should please the average taxpayer. The financial storms continue in the out years and will have to be watched.