February 6, 2013
DiNapoli: Gloversville Faces Fiscal Challenges
City Holding Down Spending, Building Up Reserves
Long-term population loss continues to limit economic growth in the city of Gloversville, according to a report issued today by State Comptroller Thomas P. DiNapoli. City officials, however, have established critical rainy day funds by controlling the growth in spending, which helped lead to a recent upgrade to the cityís credit rating. The report is the latest in a series of fiscal profiles on cities across the state released by the Comptrollerís office.
Due to the decline of the city’s industrial base, the population of Gloversville, located in Fulton County, has dropped 34 percent since 1950 to 15,665 residents. DiNapoli’s report found the population continues to experience consistently higher rates of poverty and unemployment than other cities around the state.
“Gloversville is struggling to cope with considerable economic challenges,” said DiNapoli. “Like many upstate New York communities, Gloversville operates with very limited financial flexibility and often struggles with difficult budget decisions. Mayor King and past city officials have been aware of these challenges and have worked hard to build a healthy fund balance and improve the city’s financial operations.”
DiNapoli’s report found weak growth in property values forced the city to implement a series of tax increases during the early part of the decade. These increases nearly exhausted the city’s constitutional taxing limit. In 2005, the city found itself with virtually no available tax margin.
Gloversville, however, has held the annual growth in its expenditures (2.1%) below the growth rate of its revenues (2.6%) for the past decade, which has helped to improve its fiscal condition. The city currently sits at 93 percent of its constitutional tax limit with an available margin of $505,000.
"I am pleased that Comptroller DiNapoli is taking the time to work with my administration to address the city's fiscal concerns,” said Gloversville Mayor Dayton King. “I look forward to partnering with the Comptroller and his staff to find new ways to minimize costs while still providing the services that residents of Gloversville expect.”
Other findings in DiNapoli’s report include:
In the coming months, DiNapoli will issue fiscal profiles on select cities across the state to further inform officials and citizens on some of the unique environmental and systemic pressures facing New York’s cities. As part of this effort, DiNapoli will also release in-depth reports on some of the issues that contribute to the financial pressures on local governments.
DiNapoli’s office recently finalized details of a new fiscal monitoring system that will calculate and publicize an overall score of fiscal stress for municipalities and school district across the state. The ‘early warning’ system will identify those headed toward fiscal crisis and give local officials and the public sufficient time to consider options for turning things around.
For a copy of the Gloversville profile visit: http://www.osc.state.ny.us/localgov/pubs/fiscalprofiles/gloversville.pdf