Saturday, June 15, 2024

Tax hike needed to ‘right the ship’

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Ellen Luczkowiak, Fiscal Affairs Officer for the City of Dunkirk, spoke to the state of the City of Dunkirk’s finances at a recent Finance Committee meeting.

“There will definitely be a tax increase next year,” said Mark Woods, City of Dunkirk Treasurer. “The dollar amount, we don’t know yet.”

But it won’t take another year for the city of Dunkirk to begin digging out of a hole that has been getting deeper and deeper for some time.

“We’re working very, very hard … to try and right the ship,” said Ellen Luczkowiak, Fiscal Affairs Officer for the City of Dunkirk.

The Dunkirk Common Council recently approved an $18.5 million bond lifeline for the City due to a projected $17 million negative fund balance by year’s end. City Attorney Elliot Raimondo previously called the financial crisis “something that has been years in the making.”

OBSERVER Photos by Braden Carmen
Mark Woods, City of Dunkirk Treasurer, noted that the current state of the City of Dunkirk’s finances will require a tax increase from its residents next year.

The OBSERVER previously reported the city had approximately $198,000 in cash on hand in late March, with debt obligations of $16.29 million.

Luczkowiak and Woods both spoke frankly about the necessary adjustments to spending in the City and the problems that it currently faces. While next year’s budget is all but certain to require a tax increase – an ask that members of the Committee highlighted has not been made in over a decade – the current budget could see substantial adjustments in the coming months, as well.

The City is working with Municipal Solutions, as well as the State Finance Committee, to address the City of Dunkirk Fiscal Recovery Act. Luczkowiak said the City is seeking help from multiple entities “to help guide us through ideas and what we need to do to come up with a plan.”

The City is modeling its efforts to rectify the current financial situation after the city of Newburgh, located just off the Hudson River north of Yonkers and south of Poughkeepsie, which suffered a similar financial crisis earlier this century. “We’re following that to understand how they came out of it,” Ellen Luczkowiak said.

Woods also spoke to the city’s cash flow issue, due to the fact that reimbursements for many of the city’s purchases have not yet been received, such as improvements already made to Wright Park.

City Councilmember Natalie Luczkowiak spoke to “an ideal Dunkirk world” with reserves to address the cash flow issues for deficits that are technically covered by reimbursements, but are not yet received.

But with so much debt and so little money on hand, what will the City do with its scheduled events? City Councilmember Nancy Nichols suggested soliciting donations from nearby municipalities to support summer events, such as the Fourth of July celebration, as well as Music on the Pier.

Another source of revenue being evaluated by the City is an increase to summer camps, which has kept a steady rate for approximately 30 years. Natalie Luczkowiak urged against an increase, which has not been decided on yet. Ellen Luczkowiak reiterated a rate increase was only being evaluated at this time.

“The bottom line is, we have fantastic programs, and nobody wants to see anything get cut in the city. But the reality is, somewhere within the next year, we’re going to have to cut to come up with this deficit,” Ellen Luczkowiak said. “We don’t want to, but we’re looking at ways that might help.”

The city is also considering a reevaluation for tax purposes. Implementation of new systems is also on the city’s to-do list.


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