Twenty-two local governments were designated in fiscal stress for 2019, according to State Comptroller Thomas P. DiNapoli’s Fiscal Stress Monitoring System (FSMS). The scores were based on financial information reported by local governments operating on a calendar year basis (Jan. 1 – Dec. 31) for 2019 (pre-pandemic). In New York, that includes all counties and towns, 44 cities and 10 villages.
“We’ve been closely tracking the trends and common problems that communities in fiscal stress are facing. Now the economic damage caused by the pandemic has dramatically altered the fiscal landscape, and many communities are struggling to provide critical services and pay their bills,” DiNapoli said. “Without aid from Washington, the options are bleak for local governments trying to stay in the black, and many more local governments may be pushed into serious fiscal stress.”
DiNapoli’s Monitoring System informs the public about local governments’ financial health by evaluating and scoring municipalities on financial indicators such as year-end fund balance, cash-on-hand, short-term borrowing, fixed costs and patterns of operating deficits. The system also evaluates population trends, poverty and unemployment to establish separate “environmental” scores for each municipality.
The cities of Poughkeepsie (Dutchess) and Niagara Falls (Niagara), as well as Suffolk and Westchester Counties received the highest designation of “significant stress.”
Designated in “moderate stress” were the cities of Glen Cove (Nassau) and Little Falls (Herkimer) and the towns of Caneadea (Allegany), Clarkstown (Rockland), Meredith (Delaware), Oakfield (Genesse), Pulteney (Steuben), Ramapo (Rockland), and Yates (Orleans). The counties of Columbia, Franklin, Monroe, Nassau, and Onondaga, and the towns of Colonie (Albany), Dayton (Cattaraugus), Glen (Montgomery), and Moira (Franklin) were identified as being “susceptible to fiscal stress.”
In total, DiNapoli has designated 31 local governments in fiscal stress for 2019. This includes nine local governments with non-calendar fiscal years announced in March, including the cities of Long Beach (Nassau) and Amsterdam (Montgomery), which had the highest fiscal stress scores in the state.
The Comptroller also released a report on common elements shared by the 31 local governments in fiscal stress. It also noted the fiscal stress risks associated with COVID-19 on local finances, including sharp declines in sales tax revenue, significant withholding of state aid payments to local governments, and existing stress factors such as low fund balance. The report highlighted the targeted training and guidance offered by the Comptroller’s Office to help local officials dealing with financial challenges.
In January, DiNapoli issued fiscal stress scores for school districts and found 33 school districts designated in some level of fiscal stress for the fiscal year ending June 30, 2019.
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