FOR IMMEDIATE RELEASE
May 4, 2020
Mayor Noble
Proposes Economic Recovery Plan in Phased Approach
KINGSTON, NY – Mayor Steven T. Noble and
the City of Kingston Comptroller have proposed a plan to the Common Council to
address the impending deficit to the 2020 budget, as a result of the COVID-19
pandemic.
Due to the necessity for local
businesses to close and for the state to be on PAUSE, the City expects to
collect drastically less sales and property tax revenue than the 2020 budgeted
estimates. Other income sources such as investment interest, parking revenue,
fees, permits and others will also be impacted. City Comptroller John Tuey is
expecting the City of Kingston to have revenue decreases between
$2,500,000-$5,000,000.
The Comptroller’s office has
formulated three estimates of potential revenue losses: a low loss estimate, a
mid-range loss estimate, and a high loss estimate. Mayor Noble’s economic
recovery plan includes three phases that would address each scenario.
Noble has asked the Common Council to implement the first phase of the plan
now, which will have minimal negative impact on city
services.
“It has become clear that we
should prepare ourselves in the event that the federal government fails to
adequately aid our City and, in turn, our ability to deliver essential services
to residents,” said Mayor Noble. “If our Federal government will not take
desperately-needed action, we’ll be forced to make very difficult
decisions.”
The next two phases of Mayor
Noble’s economic recovery plan would be implemented as the City learns more
about federal aid and sales tax figures. The plan outlined below is subject to
change based on the emerging financial picture of the City over the coming
months ahead.
Phase 1 (Immediate): Departmental
budget cuts, hiring freeze, and overtime pay reductions. By strictly cutting
back budgetary spending across all City departments, leaving currently
unoccupied positions unfilled, and limiting overtime pay across City
Departments, the City will save approximately 1,611,889.58. In order to
meet the planned reduction in revenue, this phase would also include allocating
up to $1.6 million from the Fund Balance to cover budget shortfalls expected
under the low-loss estimate forecast.
Phase 2 (June 1): Phase
2 would be implemented if mid-range estimates become more realistic based on
early sales tax returns and/or confirmation of local aid cuts by New York
State. During this phase, temporary layoffs would occur in multiple areas of
City government and would cause a temporary impact in the delivery of some City
services. Phase 2 could also include a targeted retirement incentive for those
employees who may be eligible.
Phase 3 (September 1): Phase
3 would be implemented if the fiscal outlook showed signs of the high-loss
scenario and would include far-reaching permanent layoffs along with severe
cuts to City services.
“The Coronavirus has
devastated on our local economy, but we don’t know yet how severe and
long-lasting those effects will be,” said Mayor Noble. “I hope we won’t have to
execute all phases of this plan, but I know we must do whatever we can to pull
our community out of this dark economic time. By having a strong municipal
financial plan, we can make sure that we continue to serve our community during
this time.”
See Mayor Noble's communication to the Common Council and more details here.