There has been little debate throughout the past few months among local officials surrounding one key aspect of the COVID-19 pandemic: the financial impact on municipalities, including Chemung County, will be substantial.
Sales tax proceeds, a key component of most municipalities’ operational budgets, has diminished drastically since March. Specifically, Chemung County is approximately $2.5 million behind projected revenues through mid-June, and losses are expected to continue throughout the remainder of the year.
Moreover, Chemung County has been advised to expect delays in payments from New York State for various reimbursement programs, and to anticipate the possibility of a 20% reduction in assistance from the Consolidated Local Street and Highway Improvement Program (CHIPS) for at least this year. Together with the potential for fixed costs such as utility rates and insurance premiums to rise throughout coming months, there is no question we need to begin looking for ways to help ease what may be significant budgetary shortfalls in 2020.
Federal assistance is necessary
The New York State Association of Counties (NYSAC) and New York State County Executive’s Association recently joined numerous other municipal advocacy groups in pressing the United States Senate to endorsed a bill passed by the U.S. House of Representatives last month that would provide $3 trillion in financial assistance directly to municipalities suffering fiscal stress due to COIVID-19.
“The COVID-19 pandemic has devastated our economies and without federal funding for states and local governments, that impact will go on for months and years,” said Albany County Executive Dan McCoy, president of the New York State County Executive’s Association and the County Executives of America. “Between our employees, our contracts, and the purchases we make, counties, states, and local governments have a tremendous impact on the national economy. We need federal funding to keep these parts of our economy moving.”
“Counties are facing fiscal pressures worse than what we experienced in the great recession,” said NYSAC President John F. Marren, chair of the Ontario County Board of Supervisors. “The best way to help our economy right now and in the near future is to inject federal funds that will protect the jobs and services that we provide at the county and local government levels.”NYSAC Press Release, 6/29/20
A copy of a letter sent to the United States Senate from NYSAC and the New York State County Executive’s Association is embedded below:
However, Senate Majority Leader Mitch McConnell has not yet introduced the bill to the Senate floor for consideration despite growing bipartisan support for him to do so. U.S. Senator Kirsten Gillibrand visited many spots in upstate New York this weekend where she echoed calls from New York leaders for a vote on the bill before the Senate’s summer recess slated to begin on August 8th:
“It seems unconscionable to me to let people go back to states for district work when that bill wasn’t passed. People will now hear from governors, and county execs and their mayors and assembly and senators and realize they better get back to Washington and do their jobs. That pressure, I feel, will be effective,” Gillbrand said during a stop in Syracuse last Friday.
Chemung County Executive Chris Moss announces changes
The Chemung County Legislature’s Agenda for its July 6th Budget Committee includes a letter from Chemung County Executive Chris Moss and two letters from Chemung County Attorney Hyder Hussain outlining initial steps the Executive’s Office is taking to address the county’s increasing fiscal stress caused by COVID-19.
The first letter, addressed to Chemung County Legislative Chairperson Dave Manchester from Moss, discusses a number of steps being taken within county government to save money:
The other two letters are from Hussain to the City of Elmira terminating inter-municipal agreements.
The first letter terminates an agreement between Chemung County and the City of Elmira started in 2019 that calls for Chemung County to make monthly advance payments of monies generated through tax foreclosure proceedings rather than one annual payment.
The rationale for adopting the arrangement last year was to help the City of Elmira have better cash flow throughout the year. However, as explained by Hussain in the letter, the county’s current financial position makes the arrangement untenable right now.
The second letter from Hussain to the City of Elmira announces that Chemung County will no longer participate in a consolidated Buildings and Grounds Department with the City of Elmira based on the same rationale.
Just over one year ago a City-County Committee, of which I was a member, produced a report that analyzed the City of Elmira’s financial condition and identified ways that the city could improve its own finances as well as places where the county could help.
However, at that time none of us could have predicted a worldwide pandemic and the serious fiscal implications that have come with it. The next few months are going to be tough on everyone as we figure out a way to help navigate our community through these very tough financial times. As always, if you have any ideas about things local government could do, please share them here or on the Chemung County Matters Facebook page and I will be sure to pass them on.