YONKERS, N.Y. – Yonkers has started making the tough choices needed to balance its budget, but it's not out of the fiscal woods yet, according to a state report.
Declining state aid and property values and growing school demands have taken their toll on New York’s fourth-largest city, State Comptroller Thomas DiNapoli said in a report presented Wednesday at City Hall.
And after years of drawing down on its fund balance to help fill budget gaps, the city is now taking positive steps to balance the budget and boost the tax base, he said.
DiNapoli was in Yonkers as part of the release of fiscal profiles for cities around the state. The reports, he said, are meant to keep officials and residents up to date on the state of their city's finances.
In the nine-page profile, DiNapoli noted that Yonkers remains better off than many other cities in the state. It enjoys a higher median household income ($55,715), home values are more than four times that of the median city and there are fewer families living in poverty, he said.
However, the city-funded school system, for which Yonkers must raise taxes and issue debt, is a major strain on the budget, the comptroller said. Declining property values, driven by a downturn in the housing market, have also taken their toll on the city’s fiscal state, he said.
As a result, the city has faced large budget gaps over the past several years and relied on reserves to help fill the void. That has caused the city’s general fund balance to nosedive from $47.1 million in 2006 to $14.5 million in 2011.
“The city lacks stable reserves going forward,” DiNapoli said.
However, the comptroller praised Mayor Mike Spano’s administration for “making tough choices” since taking office.
He noted Spano’s hiring freeze and merger of city departments to cut costs. The city has also been promoting economic development initiatives that have the potential to boost city and school district finances.
“We are working diligently to get the city back on the road of fiscal stability,” Spano said.
But, the mayor warned, there is no immediate fix. An $86 million budget gap is projected for 2014, and a $187 million shortfall in 2016.
“It took us many years to get into this position,” Spano said. “It’s going to take more than a year to get out.”