News Release

Budget Milestones/A Call for Creative Thinking 3/30/2011

Click here for a pdf version of the following

OLEAN – March 30, 2011 -- Mayor Linda Witte said she sees several milestones and a clear path for the future in the Olean Common Council’s 4-2 passage of the 2011-2012 budget Tuesday night.

“The 19-cent per $1,000 increase in the tax rate -- a hike of 1.35 percent -- is the lowest general fund tax increase in a full decade,” she said, noting this milestone translates to a tax rate of $14.63 per $1,000 of assessed value -- for an increase of only about $12 in the average homeowner’s tax bill -- while water and sewer rates will stay the same.

Mayor Witte said she was especially proud of the four aldermen who carried out their due diligence by meeting with department heads and making the hard decisions in a cooperative way, enabling the earliest budget passage anyone can remember.

“Our job is to look at the whole picture and keep an eye on the future and we accomplished passage on March 29, more than two weeks before the deadline. It’s important that our taxpayers understand that while a quick fix to slash taxes sounds easy, it could result in an undesirable setback. This is not a responsible part of the deficit spending structure that the state enacted in 2006 to help us regain our financial footing.”

The general fund totals $16,106,467, which is an $88,153 increase over the 2010-2011 budget. Following the recommendations of the New York State Comptroller’s review team, it makes a key adjustment required for proper debt service accounting, and includes an increase to restore health to the contingency fund that had been depleted while the deficit approached $4 million leading up to 2006.

The $765,000 contingency will provide a “cushion” for emergencies and, according to Auditor Fred Saradin, the amount is 4.75 percent of the general fund, nearing the recommended five percent.

“After meeting with the New York State Comptroller and taking their suggestions we knew we did not want to go below a one percent tax increase. The New York Council of Mayors recently forecast uncertainty in the state budget process. We need to plan for the unforeseen costs that could be coming down from Albany in the form of a tax shift to local governments,” said Mayor Witte.

She said it is important to note that the budget includes no layoffs or increases to the current full-time staff city-wide, making public services stable. But she pointed to what she said is the real problem for city finances: a continuing drop in the assessed value of all taxable properties.

“We must move on, we’ve adopted a budget and now I want to issue a call for creativity,” said Mayor Witte. “We must work together to find a solution to the real problem dragging us down: shrinking assessed values of commercial, industrial and residential properties citywide. Let’s all focus on finding a way to reverse that trend, attract some new commerce that fits with our community’s character and begin to set some new targets for growth.”