CARS HOMES JOBS

Mechanicville's mess took years to create

Friday, January 3, 2014
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The good news is that the Mechanicville City Council decided against buying a $500,000 fire truck, sparing taxpayers a 19.5 percent tax hike. The bad news is council members approved everything else in the budget, there was no rainy day fund cushion to help pay for it, and taxes in the city this year will be going up 17.7 percent as a result. That seems astonishing, but only for those who haven’t been paying attention in the city for the last year or so.

It was early last February that a knock on the door from the state comptroller’s office provided a sobering heads-up: Record-keeping problems (blamed on faulty financial software) had for two years obscured the fact that the city was practically broke. City officials were clueless about whether they had enough cash was on hand to pay bills and had to call the bank daily to check on the balance. Accounts weren’t being reconciled in timely fashion by financial officers, and because the city council rarely received updates on how much money was around, or being spent, it couldn’t provide needed oversight.

Budget-making was equally haphazard, according to the audit: Officials were using previous year’s estimated expenditures rather than the actual ones and, not surprisingly, the estimates were often wrong.

Supposedly things have been straightened out: There’s new accounting software, a new finance commissioner and a new deputy finance commissioner. With the help of an outside accounting firm, the city’s books were finally balanced and the City Council has been getting more regular updates.

But the cupboard was bare when it came to offsetting the spending in this year’s budget, and a big tax hike was the only responsible way — short of making massive cuts — to deal with it.

Mechanicville is a small city (roughly 5,200 people) with a small budget (just under $5 million), and few, if any, millionaires. A tax hike of such magnitude is bound to make an impression. We hope it’s enough of one that residents (including politicians) don’t soon forget, and stop paying attention to what’s going on in City Hall.

 
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