Mayor Stratton sounds budget alarm in Schenectady

In the next two years, the city must cut $13 million from its $78 million budget just to keep taxes

In the next two years, the city must cut $13 million from its $78 million budget just to keep taxes from rising, Mayor Brian U. Stratton said Monday.

He warned that if changes this year do not add up to enough to fill next year’s hole, the council will have to lay off workers or cut services, or both.

“We should know if we have to take that step by the end of summer or September,” Stratton said. “We need to enact systemic, long-term change.”

Stratton proposed a three-page list of savings that could be implemented now to save money before 2011 hits.

Among them:

* The Fire Department could immediately start billing the insurance of nearly every patient it sees — even those who do not need advanced life support.

In the past it charged about 15 percent of its patients, the ones who needed defibrillation, life-saving drugs and other extreme measures.

But about 78 percent of the department’s medical calls are for possible advanced life support situations — and it could charge patients’ insurance for each of those ALS evaluations. That would likely bring in $500,000 from about 6,750 patients.

“We could charge for nearly every call,” Fire Chief Robert Farstad said.

The department cannot charge for basic life support, but it only gets about 2,000 such calls each year.

* Stratton also wants to stop paying delinquent taxes owed to the county and school district by individual property owners.

That would save the city $4 million a year, Stratton said.

“Each taxing district should be responsible for its own taxes — collecting them and making do without those they cannot collect,” he said.

He noted that the cities of Albany and Troy are not required to make their county and school district whole when property owners don’t pay up.

Corp. Council L. John Van Norden said the city may be able to simply tell the county that it will no longer be made whole at tax time.

While the city is currently legally responsible for the school district’s taxes, there appears to be no such requirement on the books for the county taxes, Van Norden said.

“Maybe there is something somewhere. We’re asking around,” he said. “I don’t find any legal requirement for that. It may just be past practice. In that case we simply say, ‘We’re not going to do it anymore.’ ”

But the state Legislature’s approval would be needed to stop paying the school district, he said.

* Stratton also wants state permission to bill nonprofits for their use of city services, including police and fire.

He said Union College and Ellis Hospital would be the largest payers under his proposed fee system.

Stratton has previously tried to get Union to agree to a $500,000 payment in lieu of taxes, based on the number of police and fire calls to campus.

Union College officials argued that the college benefitted the city in many other ways — including the recent reconstruction of a city baseball diamond that will be primarily used by the college’s team during the school season. Citing such efforts, they refused to pay cash.

Stratton said he is now certain they won’t agree to a PILOT, that’s why he wants the authority to bill them instead, he said.

* Stratton also asked the city’s unions to approve a change in health coverage that he said would allow better service and a savings of $500,000. He also wants to offer an early retirement incentive that he believes could save $300,000.

And he’s still looking for a tax lien company that would pay more for the city’s delinquent taxes, which it could then collect privately after adding on large fees.

He hopes to find a company that will pay $500,000 more than the current company, American Tax Funding.

* He also asked the council to review all of the city’s 100 fees — with the exception of the residential garbage fee — and raise some of them. He estimated that could garner an additional $200,000.

Creating a safety program could also reduce the city’s workers compensation costs by $200,000, he said.

But beyond that, he warned of “hard choices.”

They include eliminating music haven funding ($30,000) and the youth employment program ($75,000), or closing the city pools.

Stratton didn’t even announce a cost estimate for that, saying he doesn’t want to consider it.

“But these are some of the hard choices that have to be made,” he said. Lifeguards are budgeted to cost $100,000 in 2010.

But first he must also balance this year’s budget, which was thrown out of whack by the governor’s proposal to cut 2010 aid to Schenectady by $236,000.

In response, he has decided not to fill six positions — saving $260,000.

He has also frozen all non-emergency equipment purchases, reduced travel, conferences and trainings, and reduced overtime for workers outside the Police and Fire department, saving $350,000 toward next year’s $12.8 million hole.

Much of that hole exists because the city spent so much of its savings on the 2010 budget that it would need another $8.1 million simply to keep pace next year.

Then there are the anticipated rises in salaries, health insurance and other expenses, which will likely total $4.7 million next year, according to Stratton’s budget planners.

Categories: Schenectady County

Leave a Reply