Buffalo Comptroller Mark J.F. Schroeder last week released a critique of Mayor Byron W. Brown’s 2018-19 budget proposal.
The comptroller says the budget is based on overly optimistic assumptions about revenues the city is counting on. The mayor responded by saying he stands by his budget. “We don’t submit budgets that are not balanced, that are not sound,” Brown said.
There’s an element of he said/he said at work here, between the mayor and a comptroller who ran for the mayor’s job last year, but Schroeder’s critique raises some valid points that deserve an answer.
The first is the budget plan’s anticipation of $17 million in casino revenue. Where is that going to come from? The Seneca Nation in March 2017 said it was ending all revenue sharing payments to the state from its casinos, including those in Buffalo, Niagara Falls and Salamanca. New York disputes the nation’s ability to do that and the issue remains in arbitration, with no quick settlement expected.
The $17 million figure, according to Schroeder’s report, assumes a $7 million payment of casino money for 2018-19, $7 million for 2017-18, plus $3 million the city says it is owed from 2016-17, when the Senecas stopped payments.
“Budgeting any amount for casino revenue is overly optimistic – budgeting two and a half years’ worth of revenue is extremely reckless,” Schroeder said.
Some other line items questioned by the comptroller:
- The new tax on entertainment tickets: The city wants to add a surcharge to the price of tickets at cultural and sports events, sort of a user fee to cover the cost to the city of providing maintenance and security services. The fee is a reasonable idea, but it’s still just that. Schroeder points out that no working group has yet been named to hatch out details of the ticket tax.
- Parking ticket money: Revenue from traffic violations is budgeted at $6 million, which Schroeder says is twice as much as the city is projected to receive by the end of the 2017-18 fiscal year.
- Sales of city-owned property: The budget proposal anticipates $8 million in revenue, but Schroeder states that the city “has only received $4 million in revenue in the past five years combined” from property sales.
And on the expenses side, the comptroller points out that overtime costs “are budgeted at $16 million, while the city has been spending nearly twice that amount in recent years.”
Schroeder’s critique also mentioned the drawing down of the city’s reserves, known as the fund balance. The unassigned fund balance is the part that can be used to fill budget gaps, Schroeder says. That figure stood at $41.9 million just two years ago, he says. “Today, (the) unassigned fund balance sits at $6.5 million, and by the end of the current fiscal year, it will either be $0 or a negative amount.”
Bond rating downgrades are a possibility, Schroeder says, and those would make borrowing money more expensive for the city.
What is Brown’s answer to Schroeder’s critiques? He shrugged them off last week during a conference call with reporters. “It’s one thing to be an alarmist,” Brown said. “It’s another thing to do the work and have ideas for the future.”
Doing the work is more than writing numbers on a spreadsheet so that they add up to a balanced budget. That’s just arithmetic. The harder work is figuring out executable strategies to actually achieve the numbers in your budget, to make your plan a reality rather than a wish list. Let’s hope the Brown administration knows something that Schroeder doesn’t, and is up to the task.