Public hears ideas on fixing financial crisis

PHOTOGRAPHER: Jill Bryce

At a public forum Thursday, town officials outlined a 10-year plan to help the town resolve its financial crisis and reduce an estimated $18.5 million deficit.

It was the first time town residents had an opportunity to meet with elected officials since the scope of the town’s financial problems were made public in a scathing state audit.

About 150 people attended the meeting.

The town must reorganize its finances and roll short-term bonds into long-term bonds by October or risk defaulting on its financial obligations.

“If we cannot sell the $16 million bonds in October, we are in serious danger of defaulting, which would devastate the town’s bond rating. The consequences are the worst-case scenario, which would be like what occurred in Troy in the mid-1990s,” said Peter Gannon, Colonie director of operations, referring to the imposition of a state control board to oversee the Collar City’s finances.

Town officials may ask the state Legislature if they can pursue deficit financing.

It is a “road map to financial recovery” that would give the town authorization to bond out the deficit and free up the money to help with cash flow, according to Gannon.

It would require the town to file quarterly reports and yearly budgets to the state for approval.

Town Supervisor Paula Mahan said several years of property tax increases are also a possibility. Another effective strategy, she said, would be to apply proceeds from the sale of various properties to the general fund.

The sale of Heritage Park for $2.7 million to Albany County is in the final stages. Mahan, a Democrat who upset Republican Town Supervisor Mary Brizzell in the November 2007 election, said the town is also investigating the sale of other assets.

Meanwhile, other measures are in place to reduce overall town spending, including a freeze on all nonessential spending; a reduction in contractual expenses; and a limit on overtime. Personnel vacancies will not be filled.

Mahan said that the town hopes to start using the Crossings park for “income-producing” projects and will begin logging the 377-acre Stoney Creek Reservoir, which is in Saratoga County but owned by the town.