A state comptroller’s report on Yonkers paints a grim picture of both the city and school district’s proposed 2024-2025 budgets, saying revenue and expenditure projections are unreasonable.
The report, dated May 20 and released Friday, said the school district’s budget is “structurally unbalanced” with a $61.9 million budget gap. The report says, among other things, that the city underestimated teacher pension benefits and other city expenses.
“There is nothing new to report here,” Yonkers Finance Commissioner John Liszewski said in a statement Friday, noting that the Comptroller’s Office reviews the city budget every year.
Liszewski said the state’s “chronic underfunding” was to blame for the structural imbalances in the budget.
“Despite the burdens on our city, we will, as we do every year, deliver a fair and balanced budget,” he said. “We look forward to working with the State Comptroller’s Office as we adopt a fiscally responsible budget that best meets the needs of our residents and schools.”
The city’s proposed budget, as submitted to the Comptroller’s Office, was $1.46 billion, including $748 million for the school system.
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Here are some of the key findings of the Comptroller report:
Yonkers School District Budget
The report found that:
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The school district faced a budget deficit of at least $61.9 million.
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The budget used $12 million in state aid for services and expenses, but that funding may not be available in the future.
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Because two contractual bargaining agreements expired in June of last year and no new contracts have been signed, the district could expect additional costs as they are resolved.
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The school district’s budget “likely understates teacher pension payments by approximately $478,000 and tuition payments by approximately $206,000.”
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$5.7 million in emergency funds “could deplete the current budgeted amount,” limiting the district’s ability to pay other unexpected costs.
City of Yonkers Budget
The report states that some revenue and expenditure projections in the city’s proposed budget are “unreasonable” and that the city’s “continued practice of using debt to pay recurring costs is imprudent.”
Other findings included:
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$87.9 million in one-time revenue funded the city’s operations. This could be money from the allocated fund balance, one-time financing from the state or money from the sale of real estate.
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The budget included revenue estimates “that may not be achievable” and several expenses “that are likely to be underestimated.”
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The proposed budget would result in “additional debt and interest costs because the costs of tax claims are tied up rather than funded through the operating budget.”
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Like the school district’s unsettled union contracts, six of the city’s eight collective bargaining agreements have expired or will soon, meaning the city could expect additional costs if they are resolved.
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6.9% of the city budget, or $100.8 million, would go toward debt obligations in 2024-2025.
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The report also states that if the city continues to borrow for operating costs, additional costs will accrue.
Recommendations
The report made several recommendations, including that the city no longer rely on one-time revenues to cover recurring expenses. It also recommended the city revise several estimates, including overtime for police and fire, and insurance and pension costs. Another suggestion was that the city pay operating costs instead of borrowing money.
This article originally appeared in Rockland/Westchester Journal News: Yonkers city, school budgets are unbalanced: NYS comptroller
