Buffalo Might Run Out of Money if Feds Don’t Provide Aid

Buffalo, N.Y., has a $35 million deficit from the coronavirus and might be unable to overcome the loss without federal financial support. Many other cities have the same fiscal concerns. “We are unable to do this alone.”

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(TNS) — The City of Buffalo, N.Y., could run out of money by Friday and has a $35 million year-to-date budget deficit due to the Covid-19 pandemic, according to a report released Tuesday by the City Comptroller's Office.

Buffalo is hardly alone in its financial situation.

As the outbreak's economic toll on the city became clearer, other towns and villages across Erie County also facing significant revenue losses continue to push for the federal government to grant them direct financial help.

To help overcome the fiscal predicaments they now face, leaders of towns and cities, alike, say direct federal aid to municipalities is needed.

Some local town supervisors say without assistance through a stimulus package, services may have to be cut in order to balance their budgets.

"We are unable to do this alone," Lancaster Supervisor Ronald Ruffino said.

The largest impact on many towns will be the loss of sales tax revenue, Ruffino said during a virtual news conference Tuesday.

But municipalities are also losing out on court fees and other types of revenue as the effects of the pandemic linger.

Lancaster officials' estimates for how much sales tax revenue the town may lose have ranged from 50 percent early on to up to 80 percent under the most recent calculations, Ruffino said.

To try to alleviate some of the financial pressure, the town is only approving purchases for capital expenditures where such spending is "absolutely necessary" due to safety issues, he said. The town hasn't hired any seasonal employees, and probably will not, he said.

Spending on services for youth and seniors, as well as recreation programs, will be hard to keep at budgeted levels without stimulus funding, Ruffino said.

"We see this being a very difficult role to maintain in 2020 if we are not granted federal assistance through a stimulus package," he said.

So far, aid to municipal governments has been left out of federal stimulus packages, which have provided money for businesses and hospitals.

A report by the state Division of Budget calls for New York to close its own projected $13.3 billion budget shortfall by cutting $10.1 billion in spending, with $8.2 billion cuts coming in a reduction of "aid to localities," which includes support for local governments.

Grand Island already has furloughed a number of employees and is pushing back spending on some recreation programs, Supervisor John C. Whitney said.

"This is just going to hurt us and impact us in ways that we are not going to be able to recover from," Whitney said.

The Town of Evans is looking at a projected $1.5 million budget gap due to projected losses in state aid and sales tax revenue, Supervisor Mary K. Hosler said.

The town has furloughed all of its part-time employees but hasn't made any cuts to its full-time labor force yet, Hosler said. Evans' marina also hasn't opened, which further cuts into the municipality's revenue, she said.

Hosler said she believes stimulus for municipalities has become a "bargaining chip" between Democrats and Republicans in Washington.

"To me, it's irresponsible," she said.

For the City of Buffalo, cash funds are projected to land in the negative by the end of the month and cash disbursements are trending lower than projected, according to the comptroller's report.

As of April 22, year-to-date revenues for the City of Buffalo were $341 million while year-to-date expenses were $376.4 million, City Comptroller Barbara Miller-Williams' report said.

The city and the Buffalo Board of Education are still expected to receive their state aid, which will result in a positive combined cash flow to the city through June, according to the report.

Mayor Byron W. Brown has previously described federal stimulus to municipalities like the city as a critical need.

©2020 The Buffalo News (Buffalo, N.Y.) Distributed by Tribune Content Agency, LLC.

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