The Mayor of Amsterdam, New York is warning of a potential double-digit tax increase.
Republican Michael Villa, who has served for three years, delivered his 2019 State of the City address last week.
He says the financial outlook for 2019 is not a pretty picture. But despite that, he’s confident the city has a bright future.
Still, there’s a big financial problem – the city is facing an $8.3 million deficit.
“We can’t stick our heads in the sand, we knew we had issues. We have made tremendous progress here and we have to keep moving this city forward,” said Villa.
Villa said the key to the turning things around is attracting investors and new people to the city.
The city has made progress recently – in September Amsterdam received a $10 million Downtown Revitalization Initiative grant from the state to jumpstart development. Officials are also looking forward to the planned mixed-use Chalmers Mill Lofts development project.
As is the case in many old industrial cities in the region, financial problems linger in Amsterdam. Mayor Villa said the city avoided a potential 8 percent tax increase last year.
“We didn’t address it then, but now I’m going to request that we move for debt financing, which involves the state, and we’ll have the state review board come in and assist us,” said Villa.
Villa said he is reluctant to cut public safety services. The mayor said he plans to meet with state Assemblyman Angelo Santabarbara and Senator George Amedore to seek debt financing through home-rule legislation. A tax increase would then likely be required to pay for the debt.
“It’s probably going to be between 10 and 12 percent,” said Villa.
To arrive at that range, the city hired a consultant. Municipal Solutions Inc. prepared a report called “The City of Amsterdam: The Fiscal Storm is Here.”
Any tax increase over the state mandated 2 percent tax cap would require the support of four out of five city alderman.
Amsterdam Ward 2 Alderman Paul Ochal said decreasing a potential tax increase would be difficult.
James Martuscello of Ward 5 told WAMC he is hoping for additional outside revenue to help lower the $8 million shortfall.
Looking forward, Mayor Villa said infrastructure also remains a primary concern. Frequent water and sewer main breaks have plagued the city in recent years, though the city has secured state funding to pay for projects.
“We’ve invested over $9 million since I’ve been in office in doing infrastructure repairs to water and sewer. We have our eye on the ball but there’s only so much we can do,” said Villa.
