Portion of fund balance will go to pay down debt
A portion of the city’s fund balance will be used to pay off existing debt to the New York State and Local Retirement System and to purchase vehicles for the police, fire, parking, and building safety departments.
At a meeting Tuesday, the Common Council voted unanimously to authorize $777,787 of the city’s fund balance be used to pay off a portion of the city’s remaining amortizations with the state retirement system.
The council also voted unanimously to use $271,500 from the fund balance to purchase three police vehicles, a response vehicle for the deputy fire chief, two all-wheel-drive hybrid vehicles for the Building Department, and one all-wheel-drive hybrid vehicle for the parking division.
Majority Leader Reynolds Scott-Childress, DWard 7, said purchasing the vehicles with money from the fund balance, rather than borrowing for them, would save the city on costs associated with a loan.
“Because we have been very careful with the budget, because we have reduced tax rates four years in a row, because we have kept our spending at an even level, we have been able to take advantage of a good economy lately, more money coming in from the sales tax agreement,” ScottChildress said. “That means that we have some money to spend in ways that will save us money in the future.”
Mayor Steve Noble requested the council approve spending part of the city’s fund balance because the total had grown to equal 15.86 percent of the spending in the proposed 2019 general fund balance. He said it is city policy to keep the fund balance between 10 and 13 percent of the total adopted expenditures in the annual general fund budget.
City Comptroller John Tuey has said once the city makes the payment on the existing amortizations, it will owe less than $750,000 to the state retirement system.
Municipalities have the option to pay a portion of their annual contribution to the state retirement system over time, leading to more predictable pension costs.
Tuey said the city will pay its retirement debt for the 2012 and 2014 fiscal years, which have higher interest rates than other years.