Schenectady announces 2021 proposed budget, predicts $12m COVID-19 related shortfall

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SCHENECTADY, N.Y. (NEWS10) – Property taxes and waste collection fees are set to increase, while 63 positions have been axed as Schenectady attempts to offset some of the $12 million shortfall it is facing because of the coronavirus pandemic. The proposed 2021 budget, which mayor Gary McCarthy announced on Thursday afternoon, does avoid layoffs to active police officers and firefighters.

Due to the COVID-19 outbreak, The 2021 Proposed General Fund Budget is $87,487,008, 4% less than the 2020 Adopted General Fund Budget.

A 20% reduction in state aid, which amounts to $2.2 million, is the biggest individual hit the City is facing. A combination of reduced tax collection, sales tax collection and reduced casino revenue have stripped a further $5 million from the budget.

“This year has presented us with many unique challenges and there are some difficult decisions that will need to be made to keep critical services intact for the residents of our city

Communities across this country continue to face the threat of financial devastation without immediate federal assistance for the essential services we provide.”

Mayor Gary McCarthy

Property taxes are set to increase by 2.8%, from $12.78 per $1,000 assessed value to $13.13 per $1,000 assessed value. A property assessed at $100,000 will pay an extra $35 in 2021.

The proposed Property Tax Levy is $31,413,411, the maximum allowed under the New York State property tax cap. Although the cap is set at a base level of 2% or inflation, whichever is lower, cities can increase their tax by a higher amount under certain circumstances. These circumstances include at least 60% of the city’s governing body voting for an increase or a carryover of up to 1.5% of tax levy growth to the following year.

Waste collection fees are increasing by $50 per unit, from $224 to $274. Units qualifying for exemptions will see a $22 increase, with fees jumping from $115 to $137, while Commercial Waste Collection Fees will also increase to $3.45 per gallon.

The number of City staff will be cut by 67, though 47 of those positions are already vacant.

COVID-19 related shortfalls are expected in the following categories:

  • State aid cut by 20%: $2.2 million
  • Reduced prior-year tax collection: $2 million
  • Reduced casino revenue: $1.9 million
  • Reduced sales tax revenue: $1.1 million
  • Fewer foreclosed property sales: $725,000
  • Fewer fees and fines: $600,000
  • Interest and penalty on property taxes: $500,000

One additional source of revenue for the city is the sale of foreclosed properties through the HOMES (Home Ownership Made Easy in Schenectady) initiative. The City currently has 69 properties available online for a total listed value of $2.6 million.

The push for federal funding to help local governments offset their coronavirus deficits is also continuing.

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