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Mark C. Poloncarz, Comptroller
06/02/09
POLONCARZ APPLAUDS CONTROL BOARD'S APPROVAL OF COUNTY FOUR YEAR PLAN AND REVERSION TO ADVISORY STATUS

Erie County Comptroller Mark C. Poloncarz today expressed support for the Erie County Fiscal Stability Authority's ("ECFSA") decision to approve the latest modified version of the Four Year Financial Plan submitted by Erie County Executive Christopher Collins and to terminate a control period and re-enter an advisory period.

"I am pleased that ECFSA has approved the County's Four Year Plan and re-entered an advisory period," said Poloncarz. "ECFSA's action reaffirms what I have been saying for three years – that Erie County's fiscal situation is stable and based on current data there is no need for ECFSA to be in a control period."

As evidence of the County's stable and improving fiscal outlook, Poloncarz pointed to four (4) consecutive years of County budget surpluses, a rebuilding of the County's general fund balance (reserves) to approximately $57 million from less than $5 million when he took office, and credit rating upgrades for the County from all three (3) Wall Street rating agencies.

The Comptroller reiterated that he has consistently stated for three years that ECFSA should not have been in a control period. He said, "Based on financial criteria, ECFSA should have been in a control period in 2005 and 2006 but not in 2007, 2008 or 2009." He further explained that no local government in New York State could reasonably create a four-year financial planning document that did not include gaps in the out-years (last two years) due to a myriad of factors, including state mandates and state actions.

Poloncarz did note, however, that financial challenges for the County loom in 2011 and 2012 and potentially 2010, and that without federal Medicaid assistance in 2009 and 2010, the County would face constraints and issues now and next year. "The Collins Administration and County Legislature will face significant budget gaps in the out-years of the Plan that will need to be addressed and which will create new financial pressure on the County." The Comptroller noted that while the Collins Administration has forecast in the latest version of the Four Year Plan a number of possible 'gap closers' starting in 2010 (one year earlier than their previous projection), many of them are speculative and vague, and are likely to face significant public and governmental opposition.

Poloncarz noted that the County Executive has previously publicly stated he will not increase the real property tax levy (rate per thousand dollars), but then uses another property tax increase as a possibility to close 2010-2012 budget gaps. He also noted that the Collins Administration's Four Year Plan includes six additional gap closers which are certain to create concern in the community and/or not be possible: fee increases, higher (and possibly unrealistic) projections of future sales tax receipts, the closure of libraries, use of fund balance (cash reserves), the termination of $12.5 million of sales tax revenue sharing with local governments, and sketchy and undefined Six Sigma savings.