Mayor's budget calls for tax increases, layoffs

Posted at: 09/30/2012 11:40 PM | Updated at: 10/01/2012 9:35 AM
By: Dan Levy

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SCHENECTADY - Just days after the city's credit rating was downgraded, Schenectady's mayor on Sunday unveiled his spending plan for next year that's designed to plug a $5 million hole in the budget.

One of the main problems Schenectady is facing is a pile of revenue that's owed to the city, money that belongs to them, that they haven't been able to get their hands on. Mayor Gary McCarthy says that's why the bond rating was downgraded, that's why taxes are going up, and that's why workers had to be laid off.

The proposed property tax hike would be about 4%, but on top of that, the mayor says he also needs to increase trash collection fees: for a single family house, up $0.38 a week to $209.00 per year; for a two-family house, up 0.77 per week to $418.00 a year; and for three-family homes, it would be another $1.15 each week, or $627.00 a year.

"People can't afford any more," said City Councilman Vincent Riggi, an independent lawmaker, "This is certainly a concern of mine. I'm a taxpayers too in the city of Schenectady. I'm on a fixed income so I know what it's like."

In addition, the mayor intends to cut the city's work force, eliminating 22 positions, forcing seven people out of a job.

"You never like to do that (lay people off)," McCarthy said. "It creates a lot of hardship and stress and it puts pressure on the entire work force, but unfortunately it's just the realities of the situation we're dealing with."

Part of the reality is that the city hasn't been able to collect $ 12.5 million owed in back property taxes, and another $2 million from unpaid parking tickets.

"We're going to approach that in the same manner as property taxes," McCarthy vows. "Where you owe us money, we're going to go after it in an aggressive and systematic manner."

Even though the city has already purchased dozens of foreclosed properties, fixed them up, and put many of the back on the tax rolls, McCarthy says more effective collections of accounts receivable would have enabled him to decrease taxes and prevent layoffs.

"We have a lot of bills we have to pay," Councilman Riggi points out, "Anything that we can cut and make it a little easier on the taxpayers, so we don't have more people going into foreclosure. It's just a snowball effect that's going on and we have to stop it. We have to stop the spending."

The proposed spending package is actually about half a percentage point less than the current year.

The mayor will present it to the city council on Monday night (October 1st). They have until November 1st to adopt a final budget.