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Local governments ponder ARP awards as budget season begins

 Schenectady Mayor Gary McCarthy
Lucas Willard
Schenectady Mayor Gary McCarthy (file photo)

Capital Region municipalities are releasing their 2022 budgets and many local governments are planning to use an influx of federal coronavirus relief aid as they plan for the year ahead.

Schenectady Mayor Gary McCarthy has introduced a $97.3 million 2022 general fund budget, which includes a small property tax decrease. And the Democratic mayor is crediting federal American Rescue Plan funding with supporting his plan to restore 45 vacant city positions eliminated during the COVID-19 pandemic.

“It’s enabling us to bring the city’s finances back to a pre-pandemic level,” said McCarthy.

McCarthy’s budget proposal utilizes $4.3 million in ARP funds. The city was awarded more than $57 million in aid from the $1.9 trillion American Rescue Plan relief package signed by President Joe Biden earlier this year.

To determine how to spend the rest of the cash, the city is hosting neighborhood meetings to gather input directly from residents. Mayor McCarthy says two more meetings are set for next week.

“We’re hearing from people with concerns within their respective neighborhoods, where they want equipment and upgrades in their parks, they want opportunities for the youth, and then they’re looking at more broad-based things throughout the city, for job training programs, to rehab dilapidated properties…”

The City of Saratoga Springs was awarded $7.7 million in ARP funds. City Finance Commissioner Michele Madigan, who presented her Comprehensive Budget proposal on Tuesday, said her fiscal plan for 2022 will utilize half that amount.

“That is in the general operating fund, which goes to support all our departments and the funds that we put aside to support non-profits in the city,” said Madigan. “And I project in 2022 we will have in additional $3.9 million – as you know it comes in two tranches – so going into 2023, the next finance commissioner is well set…”

Madigan said her $54 million General Operating budget – which does not include a property tax increase – is buoyed by strong projected revenue as the economy recovers, including a strong return on sales tax, higher than that of pre-pandemic 2019.

Though its ARP award is going to its general fund, Madigan said the Spa City will need to start determining ways to spend another wave of federal funding she anticipates from a major infrastructure package.

“The city is going to start having to plan to go after some of that money through grants to help us with infrastructure problems such as like our dam, roads, bridges, we all have these same issues. And, potentially, to help us grow our fire department staff, because, as you know, we’re going to bring on a third fire/EMS [station] and we did put funding in our budget for four new fire fighters,” said Madigan.

Another Capital Region city, however, is not planning using ARP funding in its 2022 budget.

Troy Mayor Patrick Madden released his $77.9 million budget blueprint Friday. The mayor said the city’s past financial woes were caused by budgets propped up by “one-shot” awards and a lack of fiscal foresight – something he wants to avoid.

“We see the federal government funds, the recovery funds as important for moving the city forward,” said Madden. “But we’re not going to fall into the trap of using that one-shot in a way that creates a future dependency.”

Madden’s spending plan carries a property tax increase within the tax cap and adds staff to departments including Code Enforcement, Streets, Parks, and Parking Enforcement. The investments, says Madden, come as the city continues to pay down past debts. The Democratic mayor is also proposing an increase to the city garbage fee, which has become a perennial sticking point with Republicans on the city council.

Meantime, Troy has begun the process of determining how to use $45.6 million ARP funds. A firm has been retained for financial advising and the city is looking to hire a marketing and PR firm to help facilitate the gathering of community input, though Madden said the city is considering some possible ways to spend the money.

“So it might be job readiness and preparation, it might be affordable housing, it might be daycare,” said Madden. “We’re looking at the critical buckets that will help people in the city recover from any damage they may have suffered, fiscal damage they may have suffered during the pandemic," said Madden.

Willard WEEKEND 1 on 1 McCarthy 10-9-21.mp3
Schenectady Mayor Gary McCarthy speaks with WAMC's Lucas Willard about his proposed budget and ARP funding

Lucas Willard is a reporter and host at WAMC Northeast Public Radio, which he joined in 2011.