Purpose of Budget Review

The purpose of our budget review was to determine whether the significant revenue and expenditure projections in the City’s proposed budget for the 2015-16 fiscal year are reasonable.

Background

The City of Olean, located in Cattaraugus County, issued debt totaling $4,300,000 to liquidate the accumulated deficit in the City’s general, water and sewer funds as of May 31, 2007. Local Finance Law requires all local governments that have been authorized to issue obligations to fund operating deficits to submit their tentative budgets for the next fiscal year to the State Comptroller for review while the deficit obligations are outstanding.

Key Findings

• Based on the results of our review, we found that the significant revenue and expenditure projections in the proposed budget are reasonable.
• The City has made progress in improving its financial condition.
• The City’s comprehensive multiyear capital plan has not been updated and used for preparing the proposed budget.
• The general fund budget does not include an interest payment of $56,708 due on a bond anticipation note.
• The City’s proposed budget complies with the property tax levy limit set by statute.

Key Recommendations

• Review and update the multiyear capital plan.
• Adjust the budget to agree with the debt schedule.
• Ensure that the potential water and sewer rate increases be authorized by the Common Council prior to the adoption of the budget.