At a glance
The Finance Committee met Tuesday to review revenue and operations through May. Building permit revenue is at 20% of budget, parking revenue is tracking on target at 42% of budget. The city's first quarterly sales tax payment of $432,000 came in strong. The committee addressed a county overcharge issue where Columbia County incorrectly collected lodging tax inside city limits through Airbnb, and discussed reinstating limited use of credit cards for certain department heads to reduce costs. The city borrowed $2.3 million in bond anticipation notes to cover cash flow for state grant projects still awaiting reimbursement.
Revenue Lines Through May
The treasurer reviewed major revenue categories through the end of May, roughly 42% of the year. Building permits are at 20% of budget due to seasonal construction patterns. Parking revenue is tracking well at 42% of budget.
Key points
- Building and plumbing permits at 20% of budget, expected given slower winter construction season
- High Street parking, permits, and tickets at 42% of budget and 49% versus last year
- New parking meters installed partway through last year expected to continue improving revenue trend
- First quarterly sales tax payment of $432,000 came in, historically the lowest quarter of the year
- 2025 sales tax totaled $2.54 million against a 2026 budget of $2.5 million
Lodging Tax Revenue and Compliance Work
Lodging tax came in at $688,000 in 2025, above the $575,000 budget. The treasurer cautioned that compliance work by staff recovered significant back taxes from short-term rental operators, making that figure partially a one-time catch-up.
Key points
- 2025 lodging tax revenue of $688,000 exceeded budget of $575,000
- City staff worked to bring short-term rental operators into compliance with registry and payment requirements
- New compliance software provides better tracking of unregistered operators
- Enforcement process escalates from software-generated notices to treasurer's office to code enforcement to city attorney
- Some of the 2025 revenue reflects back taxes collected, not ongoing revenue
The $688,000 in 2025 lodging tax revenue includes catch-up payments from operators brought into compliance. Future years may not reach that level without similar enforcement efforts.
County Lodging Tax Overcharge Issue
Columbia County incorrectly collected its 5% lodging tax on short-term rentals within city limits through an agreement with Airbnb. The county lacks authority to charge that tax inside Hudson. The city is working with the county and Airbnb to stop the charge and resolve how collected funds should be returned.
Key points
- Columbia County signed a deal with Airbnb to collect county lodging tax but did not exclude city limits where the county has no authority
- County began charging short-term rental operators inside Hudson the 5% county tax
- City treasurer notified county immediately upon learning of the issue
- Airbnb was supposed to use a geographic shape file to exclude Hudson addresses but has not completed the fix as of last week
- County and Airbnb are redoing their agreement to exclude the city
- Open question remains about how money already collected gets returned to operators and their customers
The county treasurer was expected to provide a status update. Two unresolved questions: stopping the incorrect charge, and determining how already-collected funds are returned to operators and guests.
Cannabis and Mortgage Tax Revenue
Adult-use cannabis tax brought in $40,000 in the first quarter, slightly higher than last year's first quarter. Mortgage tax payment of $103,000 arrived, nearly half the annual budget.
Key points
- Adult-use cannabis revenue of $40,000 in first quarter, slightly above last year
- On track to meet 2026 budget if quarterly payments continue at similar levels
- Revenue lower than initially hoped when the law passed but provides new income
- First mortgage tax payment of $103,000 received, almost half the annual budget
- Mortgage tax is highly variable depending on real estate transactions and unpredictable
Fund Balance and Fiscal Health
The city's unrestricted fund balance stands at $1.4 million after a $160,000 loss in 2025 and a $1.3 million loss in 2024. Financial guidance recommends a minimum balance of $2.56 million.
Key points
- Unrestricted fund balance currently at $1.4 million
- City recorded a $1.3 million loss in 2024 and $160,000 loss in 2025
- Government Finance Officers Association recommends minimum fund balance of $2.56 million for Hudson
- The fund balance figure will be confirmed after independent auditors complete their review
- Need to increase fund balance or at minimum stop decreasing it
The treasurer flagged this fund balance issue as a standing reminder until the 2027 budget process begins.
Retirement System Reporting Requirements
The treasurer's office has been working to meet increasingly complex reporting requirements for the New York State retirement system. After months of work, the office believes it is close to achieving gold certification.
Key points
- New York State retirement system is expanding and modernizing reporting requirements
- Gold standard certification requires reporting on new data points never previously tracked
- Integration between the state system and the city's payroll system has been difficult
- Poor implementation of the city's payroll system created additional complications
- Staff believe major hurdles are past and gold certification will be reached before year-end
Online Payment System Upgrade
The city upgraded its general ledger, tax collection, and water and sewer software in 2025. A new online payment system will integrate better with the software and allow water and sewer payments online for the first time.
Key points
- General ledger, tax collection, and water and sewer software upgraded in 2025
- New online payment system will integrate more smoothly with city software
- Integration expected to reduce manual labor identifying online payments
- Water and sewer payments will be accepted online for the first time this year
- Staff requested the ability to pay all four quarterly water and sewer bills at once but the vendor cannot accommodate it due to how the software handles metered sales
Credit Card Use Proposal
The treasurer proposed allowing limited credit card use by certain city officials. A resolution currently prohibits all credit card use following past fraud issues. Buying postage-paid envelopes with a credit card would cost half as much as current purchasing methods.
Key points
- City operations do not allow credit card use due to a resolution passed after past fraud
- Purchasing postage-paid envelopes via credit card would cut costs in half for the treasurer's office
- Proposal would allow very limited credit card use under treasurer's office control
- Both the treasurer and a second authorized person would have to sign off on charges
- Committee expressed openness to the idea with appropriate constraints in place
- Treasurer will prepare a recommendation and proposed process for next month's meeting
The treasurer will present a recommended process for limited credit card use with appropriate controls at the next Finance Committee meeting.
2026 Borrowing for Grant Projects and Fire Truck
The city borrowed funds to cover cash flow for state grant projects awaiting reimbursement and to finance the new fire pumper truck. The pumper truck will be financed with a 20-year bond at 3.55% interest, costing about $60,000 per year in debt service.
Key points
- City borrowed for ongoing cash flow for the downtown revitalization initiative and Ferry Street Bridge, plus the new pumper truck
- New pumper truck scheduled for delivery in July
- 20-year bond for pumper truck sold at 3.55% interest, about $60,000 annual debt service
- City borrowed $2.3 million in bond anticipation notes for grant project cash flow
- Both downtown revitalization and Ferry Street Bridge are complete but grants have not been fully reimbursed
- A $3 million reimbursement arrived May 31, one day before a planned borrowing of $3 million more, allowing the city to reduce borrowing
- Notes are callable, allowing the city to pay back principal and interest early as reimbursements arrive
Grant Reimbursement Delays and Interest Costs
The city has paid over $1 million in interest on borrowing to cover cash flow for state grant projects that were supposed to be fully funded. One reimbursement took 23 months to arrive. The treasurer emphasized that large grants carry hidden costs even when they are technically free.
Key points
- Ferry Street Bridge and downtown revitalization projects supposed to be fully grant-funded with no city cost
- City has spent $2.1 million out of pocket so far, including $1 million in interest
- One downtown revitalization reimbursement of $1 million took 23 months to process
- Some Ferry Street Bridge delays were caused by slow grant submissions, not just state processing
- Projected 2027 costs could bring total out-of-pocket expenses to $2.4 million
- For smaller grants, the city can do inter-fund loans and avoid paying interest to itself
- Large projects require external borrowing and generate significant interest costs
The treasurer emphasized that large grants carry substantial hidden costs in interest even when the project itself is fully funded. Reimbursement delays compound those costs.
Members discussed maintenance costs for new grant-funded infrastructure. The Ferry Street Bridge was already maintained by the city, but new parks like Oakdale Park or Charles Williams Park will add ongoing expenses.
2025 Borrowing Payoff
The city paid off $7.9 million in bond anticipation notes from 2025, including over $320,000 in interest. The 2026 borrowing provides cash to pay off the 2025 notes while waiting for grant reimbursements.
Key points
- City paid off $7.9 million in bond anticipation notes from 2025
- Payment included over $320,000 in interest
- New borrowing in 2026 provides cash to retire 2025 debt while awaiting grant funds
- Treasurer expects 2026 borrowing paid in 2027 will be the last round for these two projects
- Future debt service should decline in 2028 when these projects are fully closed out
Foreclosures and Fee Schedule Review
The treasurer reported that title searches for foreclosure properties are proceeding more slowly than anticipated but remain on track. The committee will review city fee schedules that have not been updated in 20 years.
Key points
- Title searches for foreclosure properties moving slower than expected
- No additional properties have come off the foreclosure list
- Committee will review outdated city fee schedules
- Some fee schedules have not been updated in 20 years
- Treasurer will coordinate a review session with the city attorney on plumbing and other fees
The committee will review city fee schedules at a future meeting or special session. Members can submit questions by email in advance.
About this page
FUTURE HUDSON is an experiment in civic engagement: every public meeting of the City of Hudson since January 2026, transcribed and made readable, so any resident can follow what the city is deciding without attending every meeting. This page covers one meeting; see the full archive.
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