CPA John Trussalo (center) Goes over the 2016 Audit with the Jamestown City Council during its Sept. 18, 2017 meeting.

JAMESTOWN – The city of Jamestown had a clean audit for the 2016 fiscal year.

That’s according to certified public accountant John Trussalo, who presented the 2016 audit to the Jamestown City Council earlier this week.

• VIEW 2016 AUDIT

The audit found total revenue for the city in 2016 was at $34.85 million, which was about $107,000 less than what had been projected in the budget. But expenses were also nearly $500,000 lower than budgeted, coming in at $34.87 million. As a result, the city finished the year with a deficit that was about $20,000. That’s significantly lower than the $410,000 that was initially budgeted.

During his report, Trussalo noted that the audit verifies the city is at 98.86 percent of its constitutional taxing limit, meaning that unless the value of total taxable property in the city sees a significant increase, officials won’t be able to significantly increase taxes in 2018 to offset expenditures.  However, the audit also found the city is only at about 33.08 percent of its constitutional debt limit, meaning it has room to borrow money if it wanted to.  The current total debt for the city at the end of 2016 was $18.77 million.

City Comptroller Joe Bellitto (standing) reviews the final numbers of the 2016 fiscal year with the Jamestown City Council during the March 20, 2017 meeting.

JAMESTOWN –  City officials received some good news on Monday night with a report from the city comptroller that showed the Jamestown finished 2016 with a slight surplus.

During Monday’s Jamestown City Council Work Session, Comptroller Joe Bellitto presented his year-end financial summary report for the $35.37 million, 2016 budget, saying the final, unaudited numbers show that the city’s revenues exceeded expenditures by nearly $100,000.

More specifically, Bellitto said the surplus came out to be $96,637 – and was largely due to the city’s healthcare costs for employees being under budget by nearly $550,000, along with an additional boost in state aid for road repairs by more than $200,000.

Jamestown Mayor Sam Teresi said the surplus was due in part to the hard work of his staff and city employees, who worked to stay within the spending parameters of the budget. However, he also acknowledged that the city was also very lucky – with the healthcare costs not being nearly as high as they had been in past years.

He also said that officials and residents need to continue to hope for good luck in 2017. Specifically, they should  hope for an on-time state budget that includes $1 million in aid for Jamestown that was pledged by the governor; along with a good economy to help improve sales tax and investment numbers; and he also said they should continue to hope for good health.

The audit, which was posted on the state comptroller’s website on Sept. 30, reviewed the City’s financial condition for the period of Jan. 1, 2012 through Aug. 19, 2016.

There were three key findings that came out of the Audit. The review found that City officials have adopted budgets that were not structurally balanced. The Audit also found that City officials have not developed a multiyear financial plan. And the Audit states that Mayor Sam Teresi, the Jamestown City Council, and Finance Director Joe Bellitto did not properly budget for, and the Mayor did not ensure that the Comptroller properly accounted for, health care expenditures.

In response to the findings, city officials offered a 12 page memo, which explained that the audit was something that was actually requested by the mayor and city council, due to the fiscal challenges the city is facing as it prepares for the 2017 budget. The response for the city also offered explanations for several of the audit’s findings, including pointing out that the city’s tenuous financial position is due primarily to state mandates and contractual obligations the city is required to honor. In addition, city officials pointed to a slow recovery from the great recession, which has had a negative impact on income.

Along with the key findings, the Audit also provided several recommendations. It said the city should adopt structurally balanced budgets that include realistic estimates and fund recurring expenditures with recurring revenues. It should also develop and regularly update a comprehensive, written multiyear financial and capital plan that includes realistic measures for rebuilding fund balance levels, addressing capital needs and restoring the City’s long-term fiscal health. And the audit said that the city should correct the accounting records to ensure health care costs and fund balance are properly recorded and reported in the general fund.

Mayor Teresi was not in his office on Tuesday when WRFA first discovered the audit on the State Comptroller’s website and so he was unavailable for immediate comment. However, Jamestown City Council president Greg Rabb told WRFA Tuesday afternoon the audit didn’t really present anything city officials didn’t already know and if anything, it reaffirmed the financial conditions they’ve been aware of for the past few years.

“All the minor stuff that they’ve said to do, we’ve agreed to do it. In fact, as the mayor likes to say, ‘It’s already been done,'” Rabb said. “But the serious financial issue that we’re facing is still hanging over our heads. So asking them to come down and talk to us was the first step. Now we need help from the state to balance our budget in 2017. I can’t talk about what the mayor’s going to say the budget is built on, because that’s his job to release [those details] next week, but we need help.”

Rabb also said that many of those recommendations are already being done by the city, including the recommendation regarding long-range planning.

“We’ve always done long range planning,” Rabb said. “If you ever look at the budgets, every single budget book has long range planning from the mayor and the city comptroller. What the state comptroller said was we didn’t fill out their long range planning form. So we said, ‘Fine, if you want us to fill out your form, we’ll fill out your form.’ But we’ve definitely been doing long-range planning.”

Teresi was unavailable for immediate comment on the audit. He will release his executive budget for 2017 next Tuesday, Oct. 11  at 3 p.m. in the mayor’s conference room on the 4th floor of city hall. The presentation is open to the public.

The mayor will also be a guest on this week’s Community Matters program (Thursday at 5 p.m. on WRFA). However the interview was conducted prior to the audit and as a result, it was not covered during the interview.

April 1 is the deadline for the 2016-17 state budget. This week the process is focused on Assembly leader Carl Heastie and Senate leader John Flannigan meeting with Gov. Andrew Cuomo to hash out a final deal.

Among the sticking points is an effort to settle on a final minimum wage increase for the state, with the GOP controlled senate pushing for a lower increase than the $15 an hour supported by Gov. Cuomo and the Democratic controlled Assembly.

Gov. Andrew Cuomo’s initial proposal calls for a $15 minimum wage to be phased in by 2018 for New York City and 2021 for the rest of the state. But Republicans in Albany say the increase would create a hardship for small upstate businesses along with farmers.

In addition to the minimum wage issue, lawmakers are also trying to settle on final numbers for education funding, tax relief, and also seeing if a final paid family leave agreement can be worked into the budget. The latest reports say that the paid family leave will be in the budget, but details on how it will be phased in need to be ironed out.

MUNICIPAL AID STRONGEST IN ASSEMBLY BUDGET

Jamestown Mayor Sam Teresi

Another issue that differs between the Governor, Assembly and Senate budgets is municipal aid for local governments. Jamestown Mayor Sam Teresi has been banging the drum for more municipal aid for the past several years, noting that the state funding the city receives now is actually lower than the aid it received in 2008, prior to the start of the great recession. Teresi says even though the state economy has since rebounded from the recession, that rebound hasn’t been reflected in the amount of aid earmarked for local government.

“the last I knew the governor had proposed no increase whatsoever in general purpose revenue sharing, freezing it at the same amount that its been at for cities and villages across the state, dating back to 2008. In 2009 and 2010 there was an actual cut for villages and some cities like Jamestown and there’s been no restoration with that, as there has been for school aid,” Teresi told WRFA on Monday.

Teresi said that this year, there has been an effort to increase state aid for local government in both the governor’s version of the budget and the Assembly’s version, but not in the Senate’s version.

“The Senate version of the budget does not give any increase whatsoever to cities, but does restore the funding for some villages in the state and, interestingly enough, the Senate actually gives funding to the five new villages that have been created in New York  State during the past five years or so. So in an era when it’s been the policy of the state government to reduce the number of small village units of government, the Senate’s budget actually rewards new villages that have been created elsewhere around the state,” Teresi said.

The mayor said that of the three budget versions, the Assembly’s would be the most favorable for Jamestown.

“The Assembly budget gives a 10 percent increase as a way to begin the corrective process of what has been taken away or frozen for local governments. That 10 percent increase for Jamestown would result in a much needed $460,000 increase in state revenue for Jamestown,” Teresi explained. “Had that happened in time for this year’s budget, we would have not only stayed within the 2 percent property tax cap, we would have had no property tax increase at all, had state revenue sharing kept pace over the past five or six years.”

Budget discussions between the three state will continue Wednesday in Albany, with a final budget compromise expected to be announced either Wednesday night or sometime on Thursday.

Comptroller Joe Bellitto delivers the 2015 budget summary during the March 14 city council work session.

JAMESTOWN – The final unaudited numbers for Jamestown’s 2015 budget show the city finished with a $908,000 shortfall.

Earlier this week city comptroller Joe Bellitto reviewed the final numbers with the city council, pointing out that the city spent $35,352,334.31, but brought only $34,444,516.01  – leading to a deficiency of nearly $908,000. That means the city will have to allocate additional fund balance money to balance the books for 2015.

Bellitto explained the main reason for the shortfall was health insurance costs for employees and retirees, with the city paying $558,000 more than budgeted.

Bellitto also said that with the deficit, the city will face several financial challenges for this year, as well as next year. Those challenges include using a large portion of the city’s health insurance reserve for this year’s budget, as well as another significant increase in health care costs for next year.

Following the presentation, City council finance chair Tony Dolce said the council will do what it can to identify ways to address the budget challenges the city will likely face for the rest of this year and into next year.

JAMESTOWN – The city of Jamestown is hoping to collect past due money from residents and visitors alike.

On Monday night Jamestown Mayor Sam Teresi explained to the city council that there is more than $1,380,000 in outstanding revenue owed to the city. More than $885,000 is due unpaid fees associated with required demolitions, property maintenance, court fees, alarm responses, and other miscellaneous charges. In addition, $498,000 comes from overdue parking tickets and Teresi is hoping to recoup some of that money starting next month.

As part of his 2016 State of the City report, Teresi said he would like took into a parking ticket amnesty program, similar to one instituted by the city in 2009. Monday night the mayor offered more details on the program, adding that if the city council gives its approval, he’d like to see it initiated starting April 1 and continuing for the entire month.

Under the guidelines of the amnesty program, people with unpaid parking fines would only have to pay the face value of the original ticket, not any additional fines associated with the violation. The mayor believes this could result in a significant amount of revenue that would help the city’s 2016 budget.

The proposal is not unprecedented. The last time the city implemented such a program was in 2009, when it netted $116,000. Teresi said that year there was actually a lower amount owed in overdue tickets, meaning there’s a chance that the city could net even more money this time around.

The amnesty program will need to be approved by the Jamestown City Council before going into effect. Lawmakers will vote on the matter during the March 28 voting session. If approved, anyone who has an overdue fine will be notified of the amnesty program and will have the entire month of April to pay the initial fine.

Jamestown Mayor Sam Teresi during the March 14 Jamestown City Council Meeting.

On Friday, Jan. 1 the Jamestown City Council held its first meeting of the year, which focused mostly on approving mayoral appointments as well as appointing the council president and committee chairs for the new term.

Councilman Gregory Rabb (D, At Large) will once again serve as president, making 2016 the ninth consecutive year he’s held the post. The committee chairs will also remain the same as last year, with Tony Dolce (R, Ward 2) serving as Finance chair, Marie Carrubba (D, Ward 4) serving as Housing chair, Maria Jones (D, Ward 5) serving as Public Safety chair, and George Spitale (D, At Large) serving as public works chair. The only new member to join the council is Victoria James (D, Ward 3), who defeated Alphonso Pagan (R) in November’s general election.

During the New Year’s Day meeting, Rabb also took time to outline the council’s agenda for 2016. Among the items he mentioned was the recommendation to consolidate the Jamestown Police Department with the County Sheriff’s Office.

Jamestown City Council President Gregory Rabb

“I ask that we continue to work cooperatively to achieve potential savings in the way we police our community by implementing the recommendations of the City/County task force while always keeping public safety our number one concern,” Rabb said in prepared statement to the council and other city officials in attendance.

As for public safety, the council president said the focus needs to continue to be on the ongoing drug epidemic sweeping the region, treating it more as a health issue.

“I ask that we continue to work with our public and private sector partners by approaching the current national drug epidemic as first and foremost a public health crisis destroying friends and families alike, potentially sapping the strength of our community. We need to continue to work to find a way to provide for a local residential treatment center,” he said.

TROUBLED FINANCIAL OUTLOOK FOR 2016 AND BEYOND

Rabb did not specifically mention the city’s current financial crisis, which was brought to the forefront near the end of last year when the council approved a 2016 spending plan that all but reaches the city’s constitutional taxing limit. In addition, the city used its remaining fund balance to help close a budget gap and it appears there will be little to no additional aid coming in from Albany.  So unless new revenue sources can be found or the city’s tax base sees significant growth during the next several months, Jamestown will be in financial dire straits for 2017.

Some in the community have already hinted at the troubles that could come with financial instability – with the possibility of a state control board coming in to oversee city operations.Rabb told WRFA following Friday’s meeting he is aware of the possibility, and the council will do all it can to see that it doesn’t happen.

“The only thing I can assure you of is that the council is well aware of that,” Rabb said. “If anybody – other than the mayor – is aware of the potential for a control board, it’s us. We’re going to be doing our best to not to have that happen. But I can’t make any guarantees. Hopefully this will be good year for us with revenue sources and expenses, but I can’t guarantee anything. We’re going to be working very hard and monitoring expenses to make sure we don’t find ourselves in that situation.”

The City Council’s first work session of 2016 will take place Monday with various committees meeting starting at 7 p.m. The full council work session is at 7:30 p.m. in the mayor’s conference room on the 4^th floor of city hall. It is open to the public.