State Comptroller Thomas P. DiNapoli today announced the introduction of a legislative proposal aimed at helping local governments across New York improve their long-term budget planning. The bill would provide reimbursement from the state to municipalities for costs incurred for hiring financial advisors to assist in the development of multi-year budget plans.
“Long-term budget planning is vital to the fiscal health of our localities,” said DiNapoli. “The tax cap and our state’s continued slow economic recovery underscore the need for accurate, balanced budgets reflecting realistic multi-year financial plans. State policymakers must continue to do their part to help localities find and implement real, lasting solutions. This proposal will help encourage municipalities to take action by offering them assistance in dealing with a potential impediment to these efforts.”
DiNapoli’s proposal would allow counties, cities, towns and villages identified as fiscally stressed to be reimbursed by the state’s Financial Restructuring Board for Local Governments for all or part of the costs associated with long-term budget planning.
Multiyear financial planning is a tool that will enable these entities to develop revenue and expenditure trends, establish long-term priorities and goals, and take into consideration the impact of near-term budgeting decisions on future fiscal years. It also allows officials to assess alternative approaches to financing operations.
DiNapoli said these types of plans will allow residents and elected local officials to better understand the impact of their fiscal decisions over time. They can then decide what program funding choices to make in advance, avoiding the need for unpredictable tax increases or dramatic budget cuts.
For a copy of the proposal submitted to both the Assembly and state Senate, visit:
http://www.osc.state.ny.us/legislation/2013-14/oscb35.htm
The proposal is part of the Comptroller’s fiscal stress initiative that includes the creation of a Fiscal Stress Monitoring System for local governments. The system, implemented last year, uses financial indicators that include year-end fund balance, cash position and patterns of operating deficits to create an overall fiscal stress score which classifies whether a municipality is in “significant fiscal stress,” in “moderate fiscal stress,” is “susceptible to fiscal stress,” or “no designation.”
To date, DiNapoli’s monitoring system has identified a total of 142 municipalities in some level of fiscal stress. This includes 16 counties, 18 towns, five cities, 16 villages and 87 school districts.