GENEVA \u2014 The city is looking at budget gaps in the millions of dollars over the next five years, and City Manager Amie Hendrix said it comes down to a simple formula.<\/p>\n
\u201cIt\u2019s compounding math,\u201d she told City Council at a budget discussion Tuesday night at City Hall. \u201cOur expenditures are growing faster than our revenue.\u201d<\/p>\n
Most of those growing expenditures relate to the costs associated with employing 127.5 full-time-equivalent workers, although six of those positions are vacant, she said in a report on the city\u2019s financial condition requested by Mayor Jim Cecere as part of a kickoff on budget talks for 2027 \u2014 and also for the years ahead.<\/p>\n
As Hendrix writes, \u201cemployee costs are the single largest and least flexible budget line for a human\/public service organization.\u201d<\/p>\n
Of the current $22.9 million general fund budget, nearly $9.79 million is salaries and wages and $5.78 million is benefits. Across the general and water and sewer funds, the number is $18 million when including salaries, retirement, Social Security, and health insurance. That\u2019s more than half of the combined budgets.<\/p>\n
\u201cOur collective bargaining agreements drive salary floors,\u201d Hendrix said, adding that health and pension costs are beyond city control. \u201cOnce a CBA is signed \u2026 the base wage is locked.\u201d<\/p>\n
In the report, the average salary of a city employee for 2027 is $79,247, although that number varies depending on the department.<\/p>\n
Police officers, whose patrol members are in the second year of a contract that provides raises totaling 16.5% over four years, are some of the city\u2019s highest-paid employees. Department salaries in the current budget are $4 million out of $9.78 million in city wages overall for 2026.<\/p>\n
Striking the balance between the need to provide services that people expect while keeping spending in check is a challenge for Hendrix and City Council given collective bargaining agreements and ever-increasing health and pension costs. Hendrix and Cecere noted that those pension costs could rise even more if the New York State Legislature gets rid of a pension plan called Tier 6, which was designed to reduce costs for state and local governments and school districts. Unions are pushing for the change, explaining the less-generous tier is discouraging people from considering work in the public sector.<\/p>\n
Cecere said Wednesday he understands the thrust of the effort.<\/p>\n
\u201cI support our workers and understand the intent behind Title VI pension reform,\u201d he said. \u201cThese changes would improve the retirement benefits for existing municipal workers. But here\u2019s the fiscal reality Geneva faces. We already carry one of the highest property tax rates in New York State. Our residents are at or near the limit of what they can bear. Any expansion of pension obligations that is not matched by direct, proportionate state aid is an unfunded mandate. Period.\u201d<\/p>\n
The gaps ahead<\/p>\n
Those rising costs and potential rising costs provide a significant challenge for Hendrix and her administrative team, including Comptroller Adam Blowers.<\/p>\n
Here are the potential budget gaps the city is looking at:<\/p>\n
2027: $1.65 million.2028: $2.13 million.2029: $2.66 million.2030: $3.23 million.2031: $3.85 million.<\/p>\n
Hendrix said that \u201cwithout structural correction, the city\u2019s financial position deteriorates each year \u2014 with or without fund balance reserves.\u201d<\/p>\n
The city often has used reserves to address budget gaps caused by revenue shortfalls, as opposed to making large budget cuts that likely include job reductions or program cuts.<\/p>\n
Cecere said the \u201ccurrent proposed approach proposed … is that fund balances cannot be used to address ongoing, structural shortfalls. It may take us a few years to move towards structural balance, and this is about building a fiscally responsible approach that also ensures continues investment.\u201d<\/p>\n
While the city looks long term, it also has to tackle the gap facing it for 2027. Hendrix said if the city kept a \u201cbaseline budget,\u201d it still faces higher costs \u2014 from an average 3.25% rise in wages to a 16% rise in health insurance costs, a number Hendrix hopes comes in lower than that.<\/p>\n
In this \u201cstatus quo\u201d scenario, in which there are no service reductions or program changes, the city would spend $24 million in the general fund, compared to $22.9 million this year. That would leave a structural gap of $1.65 million and result in a 20% increase in taxes, resulting in the tax bill for a median home valued at $143,550 rising $326.<\/p>\n
A 20% tax increase is a non-starter for Council, and that means the city will need to look at the two other scenarios Hendrix outlined: spending reductions that would likely include a reduction in services and some job cuts, possibly through attrition.<\/p>\n
Hendrix said after Tuesday\u2019s meeting that her administration and councilors have some tough conversations ahead.<\/p>\n
\u201cThis budget season will require thoughtful deliberation and, at times, difficult conversations,\u201d she said in a message to stakeholders. \u201cWe began that work tonight and Council will continue the discussions at the May 6 meeting, where they will further discuss budget parameters and priorities.\u201d<\/p>\n
Cecere acknowledges the city\u2019s financial predicament.<\/p>\n
\u201cWe are facing real structural challenges,\u201d he said Wednesday. \u201cThe gap between revenues and what we can support is not sustainable. The good news is that we can see this clearly now, and we have time to make deliberate, thoughtful decisions. The difficult news is that decisions will need to be made, and some of them will not be easy.\u201d<\/p>\n
Cecere stressed that he wants to be \u201cspecific about where the budget pressure is coming from, because I think there\u2019s also an assumption that the city makes poor spending decisions. The single largest driver of our cost challenges is employee-related spending. These include salaries, pension contributions, and health care. Together, they represent the vast majority of spending. Many are driven by collective bargaining agreements and state-mandated pension systems. With this, what we can do is be disciplined about future contracts, deliberate about our staffing levels over time, and be honest with ourselves about what we can sustain. We want to be an employer of choice, and want our people to be adequately compensated. I believe the realities we face and this goal can co-exist.\u201d<\/p>\n
Cecere and councilors are looking to create a formal resolution for June to provide guidance to Hendrix and staff on where they want to go with the 2027 spending plan, which needs to be adopted by Oct. 31.<\/p>\n
The mayor and Council lauded the work of Hendrix and Blowers on the document, which Hendrix said was constructed with the help of artificial intelligence.<\/p>\n","protected":false},"excerpt":{"rendered":"GENEVA \u2014 The city is looking at budget gaps in the millions of dollars over the next five…\n","protected":false},"author":2,"featured_media":54999,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[7],"tags":[30847,16794,114,30852,30850,39,30853,5321,167,30854,65,70,2811,11553,18379,30849,1406,30851,69,13499,174,30845,13598,30846,178,30848],"class_list":["post-54998","post","type-post","status-publish","format-standard","has-post-thumbnail","category-geneva","tag-austerity","tag-budget","tag-business","tag-collective-agreement","tag-collective-bargaining","tag-economy","tag-employee-relations","tag-employment","tag-finance","tag-fund-accounting","tag-geneva","tag-government","tag-government-finances","tag-health-insurance","tag-labor","tag-nfl-collective-bargaining-agreement","tag-pension","tag-political-economy","tag-politics","tag-public-policy","tag-retirement","tag-salary","tag-social-policy","tag-social-security-united-states","tag-tax","tag-wage"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116459699022996473","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/54998","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=54998"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/54998\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/54999"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=54998"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=54998"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=54998"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}