Town departments, nonprofits face funding cuts
By Terry Duffy
The Town of Lewiston opened the door this week to the strong possibility of a town tax as it released its tentative $16.250 million budget Tuesday for fiscal year 2017. The plan, an increase of $918,824 over last year's $15.601 million budget, reflects the harsh realities the town is now facing - no excess funds to cover its ever-growing expenses.
"We don't have the money anymore; we're down to the nitty-gritty," said Town Finance Director Martha Blazick, who added, as it stands, the town has no other recourse but to impose a tax on its residents - the first in nearly two decades.
Monday evening the Town Board set the stage as it approved a local law intended to override the state cap.
It's a "presentation of a local law for a tax cap override for 2016," commented Town Supervisor Steve Broderick.
The move follows the announcement by State Comptroller Thomas DiNapoli in July that the state tax cap of 2 percent, adjusted for inflation annually, would be locked in at 0.68 percent for 2017 - down from the 0.73 percent in the 2016 fiscal year.
DiNapoli commented that the 2017 figure, which reflects inflation, would directly affect all local governments in the state that operate on a calendar-based fiscal year, including Lewiston.
"In what is becoming the norm, New York's local governments must cope with extremely limited growth for property taxes to stay within the tax cap," said DiNapoli. "Low inflation has positive effects for consumers, but it also reflects an uncertain economic environment. Local officials have faced growing fixed costs and limited budget options for years, but 2017 will necessitate even tougher financial choices."
Monday evening, Town Attorney Brian Seaman explained the purpose of the tax override, calling it part of the process as Lewiston considers its options. With no tax at present, the town would be looking at what is essentially a 100 percent increase, said Blazick.
"In order to override the tax cap, to impose a tax, an increase over what's going to be allowed this year, which is almost ... negligible, the Town Board will have to pass a local law allowing the town to do that," explained Seaman. "Even if you ultimately don't do it, the local law would have to be passed in order to consider the possibility of overriding the tax cap.
"The local law basically says that you're passing the law to override the tax cap. This just makes it so you can impose a tax levy higher than the tax cap set by the state," said Seaman.
As it approved the measure Monday, the Town Board announced that it would set a public hearing on the law en route to finalizing it. The hearing will take place at 6 p.m. Monday, Oct. 24, prior to the board's regular meeting at Town Hall.
Moving to the budget, as it currently stands, the town faces significant funding gaps, most notably in its A Fund - General accounts, and also in its DB Fund - Highway/Drainage-town outside village, according to Blazick.
She said the A Fund totals $2,630,625 in appropriations, includes $1,994,125 in estimated revenues and calls for $636,500 to be raised by taxes. The DB Fund totals $3,046,057 in appropriations, includes $2,761,587 in estimated revenues, and calls for $500,000 to be raised by taxes.
Blazick said in the past the town used fund balances to cover its A Fund cost overruns, but those no longer exist. "The A Fund has been in a negative for years. They (past administrations) have been spending the fund balance. They used it all up," said Blazick.
She reported for example the town had $1.2 million in its A Fund fund balance account as of December 2012 and $369,000 in December 2015. "There's no fund balance" today, she added, likening it to using a savings account to pay one's expenses until it's empty.
As for highway costs, Blazick said the town, over the years, typically has gone the route of bonding to fund equipment purchases such as new trucks and paving. But that route also carries fluctuating interest that the town has to contend with. A look at a Highway BAN 2015 account of $1,425,000 from September 2007 reveals $175,000 in principal and $14,210.42 in interest charges.
"They used it for paved roads and expected grants. There were no grants. The town is living with it," said Blazick.
As for Lewiston utilizing other revenue sources, Blazick said that funding to the town continues to decline, noting stagnant Modern Disposal tipping fees and lower than expected sales taxes.
Another significant loss has been the gross receipts taxes paid by CWM Chemical Services from its host community agreements with the town to operate its hazardous waste landfilling operations on Balmer Road.
Blazick said that in past years the town saw annual payments from CWM that ranged from $250,000-$275,000 to as much as $1 million, based on its landfilling activity. But as those operations declined, so has CWM's payments. In the town's 2016 budget, for example, it factored in CWM revenue of $75,000 and $63,025. With CWM's Residuals Management Unit 1 hazardous waste landfill at capacity and now closed, Blazick said she is factoring in a mere $7,000 in CWM gross receipt taxes paid to the town for 2017.
Added to that is Lewiston's expense of sharing in attorney's fees with the county and other municipalities to address potential litigation against CWM as the state Department of Environmental Conservation's appointed hazardous siting board continues to decide the company's future. Lewiston earlier teamed up with other entities, notably Niagara County, in a shared cost arrangement to enlist the services of environmental attorney Gary Abraham in the CWM battle. Blazick said the 2017 town budget provides for $100,000 to Abraham for his services and $50,000 planned for 2018, with future funding remaining open-ended under the current county-town arrangement.
Faced with the aforementioned financial challenges and shortfalls, Blazick said that beyond the town tax the budget calls for belt-tightening for all town departments. Also revealed was a 10 percent funding cut to a number of town nonprofits. Noted on the list are the Lewiston Public Library, the Sanborn and Ransomville libraries, Artpark, the Lewiston Jazz Festival, NIMAC, the Sanborn Business Association, Sanborn Historical Society and the Lewiston Council on the Arts, among others.
Barring miracles, Blazick dismissed the likelihood of any significant funding being returned under the current budget scenario. The Town Board will be reviewing the 2017 budget in greater detail with town departments and its supported agencies over coming weeks en route to the Oct. 24 public hearing. The town's budget needs to be finalized and filed with the state by Nov. 21.
"Look, people really have to learn this budget," said Blazick. "If you want to keep services, you will have to tax.
"People will have to understand this. There is such thing as a simple solution."
The town budget can be viewed online at www.townoflewiston.us.