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City of Troy – Budget Review (B17-5-13)

Issued Date
October 31, 2017
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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 2018 fiscal year are reasonable.

Background

The City of Troy, located in Rensselaer County, is authorized to issue debt not to exceed $24,706,000 to liquidate cumulative deficits in the City’s general fund for the years ending December 31, 1993, 1994 and 1995. New York State Local Finance Law requires all local governments that have been authorized to issue obligations to fund operating deficits to submit their proposed budgets for the next fiscal year to the State Comptroller for review while the deficit obligations are outstanding.

Key Findings

  • Significant revenue and expenditure projections in the proposed budget are reasonable.
  • The proposed budget includes estimated revenues of $3.45 million for refuse and garbage fees to finance the City’s waste and recycling services, but the Council has not yet authorized or approved a combined waste and recycling fee to realize the estimated revenues.
  • All six of the City’s collective bargaining agreements (CBAs) have expired and the City faces potential significant increased salary and wage cost when these agreements are settled.
  • The City’s proposed budget is in compliance with the tax levy limit.

Key Recommendations

  • If is essential the Council make the appropriate modifications to the City Code prior to adopting the budget if it decides to implement a new waste and recycling fee. If the fee is not authorized, or is authorized at a different rate, the general fund proposed budget should be modified accordingly prior to adoption.
  • City officials should consider the potential financial impact of the settlement of the expired CBAs and be prepared to provide funding if any of the CBAs are settled in 2018.
  • The Council should be mindful of the legal requirement to maintain the tax levy increase to no more than the tax levy limit as permitted by law, unless it adopts a local law to override the cap.