City of Troy – Budget Review (B5-12-21)
Released: November 14, 2012 -- [read complete report - pdf]
Purpose of Audit
The purpose of our budget review was to determine whether the significant revenue and expenditure projections in the City’s tentative budget for the 2013 fiscal year are reasonable.
The City of Troy, located in Rensselaer County, issued debt totaling $21,630,000 to liquidate cumulative deficits in the City’s general fund for the years ending December 31, 1993, 1994, and 1995. Local Finance Law requires all local governments that have been authorized to issue obligations to fund operating deficits to submit their tentative budgets for the next fiscal year to the State Comptroller for review while the deficit obligations are outstanding.
The City’s proposed budget, while generally reasonable, needs improvement to make it a better tool for prudently managing the City’s resources.
- The sewer fund has displayed a trend of weakening financial position and, while the City has proposed increasing sewer rates, the operations of the fund must be monitored to ensure the declining trends are reversed.
- The City’s 2013 proposed budget does not appropriate enough money for contingencies to provide adequate flexibility to pay for unanticipated costs.
- The City’s 2013 proposed budget provides only minimal funding for capital improvements: the City’s 2013 capital plan in the general and water funds are underfunded by a total of $3.5 million.
- The City’s proposed budget is in compliance with the tax levy limit.
- The City should adopt a reasonable 2013 budget for the sewer fund and develop a strategy to finance the short-term and long-term liabilities related to the Combined Sewer Overflows Long Term Control Plan.
- City officials should budget appropriately for contingencies.
- City officials should identify reliable funding sources for capital expenditures and include these funding sources in their operating budgets.
Local Government and School Accountability Contact Information:
Phone: (518) 474-4037; Email: email@example.com
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236