The Town is Fiscally Healthy

 

Dear Islanders;

The Town of Grand Island is in good fiscal health—very good. If it were a person, its mailbox would be stuffed full of credit card offers. It has the highest bond rating (think credit score) of any municipality of its size in WNY. The bond rating actually went up my first year in office to Aa1, and we didn’t even request the bump. Plus, we have healthy fund balances (think of it like money in a savings account). Much credit should go to our Town Accountant, Pam Barton, and her team for keeping on top of things.

Our Town taxes are relatively low. 

When people say, “My taxes are too high!” I want to explain that only about 20% of your taxes, on average, go to the Town. Another 20% or so goes to the County and the remaining approximately 60% goes to school taxes.

The average household on Grand Island only pays a little more than a $1,000 to the Town. That covers garbage, fire, road repair and service, water, sewer infrastructure, and more. It’s a good deal! I challenge you to find a way to pay for all those services on your own and see if you can do it for $1,000. Not possible. 

Cuomo wants smaller local government

Governor Cuomo is a Democrat. You can call him a tax and spend liberal all you want, but the facts don’t reflect that. He's constantly stumping about fiscal “diets” and shrinking NYS government—at least local government. He was just in Buffalo last week preaching consolidation. In other words, he wants governments to share services, because it will cut costs and lower taxes, thus making NY a more competitive State. 

He’s right. But what can we consolidate on Grand Island? It only goes so far. We are an Island with a moat around it. We don’t have an adjacent community that we can easily share services with. Think about it. If we shut down our highway department, would we have to wait for a truck from Tonawanda to come every time we needed a pot hole fixed? The tolls and bridges alone would make it a challenge. And forget about closing the fire department. 

We can’t raise taxes much even if we wanted to

To get towns to consolidate, Cuomo put in a tax cap. Under the Governor’s 2% tax cap we can’t raise the Town taxes more than 2% each year. In reality that 2% is approximately only 0.6%, because you must take the lower of 2% or the Consumer Price Index. From a practical perspective, this means that we can only generate a tiny bit more cash each year to run the Town (literally, a few thousand dollars). You might think that’s a good thing, and it is. But it’s a challenge.

It’s a challenge because of inflation (utilities costs go up, cost of supplies goes up). More importantly, it’s a challenge because of the infrastructure we need, like water lines, sewer lines and roads. If a water line breaks, we need to find a way to fix it, even if we are short on cash. It might be the same for you if your water heater breaks or your transmission drops. Even if we wanted to, we couldn't neglect infrastructure investment and repair. We have "consent decrees" in place (government orders) requiring us to make certain levels of investment. Thus, every year we need to take and use a little bit of those fund balances we built before the Cuomo tax cap (the savings account I told you about above) to pay for things. Thankfully, we still have some cash. Other municipalities aren't so lucky. 

Just like a business, we can grow though prudent investment

Even with the tax cap and the eroding fund balances, things are still pretty good. And lucky for us, we can still grow our tax base. We can still bring in new business, we can still build new homes (but hopefully no more apartment complexes). And hopefully Canadians will continue to come to America to shop. You might gripe about their driving, but Western New York stays afloat because of the sales tax generated by shopping Canadians—who still come even though the exchange is terrible. Our town gets some of that money from the County. So, if you meet someone who is excessively nice at the mall and keeps saying “eh?”; welcome them! 

If our tax base grows, we can stay healthy. Some people might say that given the challenges we face however, we should not spend a penny. They might argue that feel-good projects--like the Community Center that we are working on or the Dark Fiber project--should all be scrapped. But there are many reasons why that approach would be a mistake. We can only grow our tax base if we offer things people, who actually pay the taxes, want. In others words, we need good services and great schools so people want to come here and so that the value of our homes goes up. It is certainly the duty of government to spend tax money wisely. But not spending it at all (on things like infrastructure that will attract business and homeowners) is not very wise. 

In short, we need to spend money to make money. Think of it like a company. You need to invest in research and development or better services so that you can stay competitive. Remember when we all thought flip phones and walkmans were great? 

How about tightening the screws on town employees?

I sometimes hear, “All town employees are lazy and overpaid.” But that’s just not true. Are some lazy? Probably. Again, just like any business, we have all types of employees. But most work quite well.

Are our employees overpaid? Again, it depends on the employee. Some seem underpaid to me for what they do and how much they save us.  But it’s not like the private sector. Government jobs are locked in legally according to mandated schedules put in by prior administrations or negotiated union contracts. It’s not like you can say, “Hey buddy, I think you are terrible, I'm cutting your pay!” The Town Board has very little wiggle room. 

I don’t think we’re really over-staffed either. You might have seen five guys working on a busted pipe once or six guys eating donuts at noon, but it’s not wise to make a broad judgment based on anecdotal evidence. I’ll admit, government jobs are more secure and offer some benefits that are hard to find in the private sector. But it would be an illogical leap to assume that means all Town employees are not working appropriately. I know how many people are in each place working each day. I think some changes should and could be made, but overall things appear quite efficient. 

How about waste? Are we ordering stacks of unused office supplies and stealing Post-its? Hardly. I have a Councilperson colleague who came into office determined to root out government waste. He spent the first year painstakingly examining every invoice certain he’d find a rat. And, by the way, we continue to carefully examine the bills. But here’s the thing, he seems to have reached a level of calm equilibrium and efficiency himself. Because after you get in office, you can see very quickly the unlikelihood that we will ever find some grand fraud. If such criminal activity existed, it would likely be easy to see. Every department has a set budget approved by Town Council. There is very little discretionary spending. But we'll keep watching. 

We are healthy, we are efficient, and we must invest to remain so.

My point here today is to tell you that things are pretty good. I’ll admit that I’m a bit of a dreamer, but I’m no spendthrift. Coming from the business world, I know the importance of budgets and the almighty plan. I would never waste your money. And while we have had heated debates on many issues, our budget review last year was extremely productive and efficient. The Town Board may disagree on policy from time to time, but by and large we agreed on the budget and worked well to put together a tight strategy. Hopefully next year will be the same.

While I am your Supervisor, I will work hard to keep us healthy and strong. Accordingly, I will also thoughtfully consider projects that help ensure our health and strength over the long term. And I agree, by and large, with Governor Cuomo’s strategy to make NY more competitive by making government leaner. There is not much left to cut before you see a dramatic decline in Town services, but I have the thinking hat on trying to consider new ways to make Grand Island more efficient. 

But hey, Governor? Want us to be really efficient? How about sharing some of that toll money with Grand Island? I promise we won’t break your tax cap—ever!

With highest regards,

Nate