Between 2007 and 2012, the City’s available fund balance increased by 82 percent, from $3.8 million to $7.0 million in 2012. In 2012, Moody’s warned that rising employee benefit costs could put upward pressure on expenditures. Also, the State cap on growth in the property tax levy could affect the City’s ability to continue to balance its budget by increasing the property tax.
Albany had no available general fund balance between 2002 and 2006. Subsequently, the City’s available balance grew to a high of $19.8 million in 2008 before declining in the wake of the 2007-09 recession. Standard and Poor’s Rating Services rates the City of Albany’s general obligation debt at AA-, at the low end of its second-highest rating category. The City has formally applied to the Governor’s Financial Restructuring Board for Local Governments for assistance and has been accepted by the Board.
Although total local sales tax collections have grown each quarter since the end of the 2008-2009 recession, the rate of this growth has shown a downward overall trend.
Like many other cities, Glens Falls has struggled in recent years to maintain services, avoid large tax increases and balance budgets. The City’s high debt service costs for infrastructure expenditures as well as its subsidization of the Civic Center continue to be a burden. By 2012, Glens Falls had drawn down its available general fund balance to $0.6 million, or 3.7 of percent of expenditures.
This follow-up report expands the analysis of the previous report; updating annual local government financial data and contrasting that to the associated local financial infrastructure needs in the most recent New York State studies. It also draws upon a new series of interviews with local officials to assess how they are working to provide the best infrastructure possible to their residents.
Overall, 35 entities were classified as being in some level of stress, with 10 designated as being in significant fiscal stress, 8 in moderate fiscal stress and 17 susceptible to fiscal stress.
The districts experiencing fiscal stress are spread across the State. One indicator in particular—the operating deficit—saw substantial changes in the FSMS points assigned compared to the previous year: 19 percent received a higher FSMS score on this indicator, while 28 percent scored lower. Changes in scores for this indicator contributed to changes in districts’ overall levels of fiscal stress.
Local sales tax growth was slower in 2014 than in any year since the 2008-2009 recession, in part due to slow growth in the first quarter of the year. Long Island collections declined, some upstate counties had strong growth due to increased sales tax rates, and New York City's growth was relatively strong.
The number of school districts overriding the tax cap has declined each year. In general, school districts’ decisions to override the tax cap were based, at least in part, on necessity. When examining the relationship between fiscal stress and tax cap overrides, we found that fiscally stressed school districts were nearly three times more likely to override the tax cap when compared to school districts that were not designated as stressed.
The sales tax generates 8 percent of all local government revenues in New York State and 27 percent of county revenues. This report examines the general sales and use tax imposed for local governments in the State. It covers the sales tax rates in counties and cities, and trends in sales tax revenues for local governments. It also includes an up-to-date county-level summary of sales tax sharing arrangements and discusses recent activity in the taxation of Internet sales.
