Common Council Finance Committee

1. 0:02Can you mic this song? This is the microphone. No, the other one's my lyrics. M is this Yeah, you can put that there. Yeah, that's fine. That sounds great. Yeah. All right. Um Heather, would you like to start? You want to do roll? Okay. Oh, I'm here. Next. Oh, we're all here. Just saying for the minutes. For the minutes. Rich is here. Yes. Catherine is here. Margaret is here. Ronnie is here. And Lola is here. Here. Would you like to? Okay. Here we go. Um, we're all here.
2. 0:52Thank you. And uh Heather, would you like to go over the report on this thing? Sure. Okay. We're going to go through uh the actuals of the some of the things that we track every month. Um so these actuals are through August. So that's 66.7% of the year. So um would like to see our year-to- date numbers be somewhere around that. Um so you can see for building plumbing plumbing and building permits um plumbing permits are at only 18% of budget right now and building permits are at 39% of budget uh for a weighted average of 37%.
3. 1:31Um not really sure why there's been such a drop off from year to year in terms of building permits. Uh but that is what it is. Um on and off street parking we're 75% of budget so that's pretty tracking was tracking pretty accurately. Uh same thing with parking and other permits at 70 and parking tickets is a little lower uh at 59% but uh still pretty close. Um sales cannabis mortgage and lodging taxes. So sales tax contribution uh we're currently at 932.8.9,000 or 37% of budget. We'll talk a little bit more about that in a minute. Uh lodging tax through August is at 409. So
4. 2:18we're at 71% of budget there, which is tracking pretty well. Uh on the flip side, adult use cannabis uh has slowed before it even really started. Not really sure why. I mean, I know that there's a little more competition out there than there used to be. There's Rainport and I think Clavix's planning on opening one. Um, so you know, we'll keep an eye on that, uh, obviously. And then the mortgage tax, we should get that probably next month. So we'll know how that comes in because it's only two payments in a
5. 2:50year. So right now we're at about 47% of budget, which is roughly half, which is roughly what we would expect to see. Um, in terms of sales tax, I was I I wanted to go back and see where we were after the first two payments in prior years. And you can see that um from 22 to 25 uh at this point in time we had somewhat over a million dollars in sales tax revenue versus the 932 that we have to date. Um I also looked to see how
6. 3:22much the first two quarters um equaled in terms of the total overall and with pretty consistency it somewhere between the 45 you know 44.8 8 to 45.9. So, right around 45% pretty consistently for the last 5 years. Um, and we're at 37% now. So, that doesn't look necessarily ideal. Um, if the 45% remains consistent, um, that we would be coming in at more like 2.1 million as opposed to the budget of 2.5. But we're not going to know until we know, right? I mean, it's it's a projection, but it's just something I think we should be keeping an eye out.
7. 4:04Um but on a positive note um so we get a thing called every year from the state. Um it's added incentive for municipalities. I think it has existed far before my time and the amount has never changed. It's like 1.491 million. They apparently have budgeted what they're calling temporary municipal assistance. Uh we got it for the first time last year and it was like about 139,000 and this year it came in it was 508,000. So that's good. And that's in addition to the other one. Yes. Okay.
8. 4:39And not something that we included in budget, but it's temporary. So we don't know if they're going to do it each because they're obviously doing because they don't want to increase aim and make it permanent. So it's their way of like recognizing the fact that municipalities need help but without, you know, making a long-term commitment basically. So who knows how long it's going to last. Who knows what the amounts will be. We get no visibility on that whatsoever. I have no idea where this amount came from. I have no idea where the 139 came from
9. 5:03last year. We haven't given us any of that information. Just came in. That came in maybe a month ago. Yeah. So, is that the time of year they usually when it's 100,000? Is that I believe so. Yes. Okay. And it can be used for what can it be used for? It can be used for anything in the Yep. So, it'll you know if the sales tax doesn't So, in terms of next year's budget, you wouldn't budget for this because you don't know what it's going to be. Right.
10. 5:30Right. Nikon I think we I don't know if you recall um it was part of like the agenda for lobby day for Nikcom. I don't know. Yeah. Yeah. So I think they try to make it permanent but government governor is not playing with the permanence which I understand. Yep. But you know it's going to help over here because Yeah. Okay. So I am happy to say that as of about two hours ago, we completed the 2025 audited financial statements. They have been uploaded to the uh federal audit uh port uh portal. Um we made our
11. 6:15deadline by one day. Uh so that's exciting. So I've got a summary here of sort of where we neted out. Um so uh we had ended up with and this is just general fund obviously it's not water sewer cemetery capital all of that information will be in the poll audit finite interest payments which I will publish tomorrow online but I did provide general fund information because that's what really we are all primarily focused on at this point. Uh so we've had revenues of 5 15.58 million and
12. 6:49expenditures of 15.512 million and then other financing uses of another 229 net. Uh the majority of that is the inter fun transfer to the cemetery fund. Um, so, uh, once again, uh, we ended up with a, uh, negative performance in terms of fiscal 2025, a net loss of about $155,000. Um, since everybody seems to be focused on fund balance, here's where we are in fund balance. Uh, we have non-spendable fund balance of 148, restrictive of 698, uh, assigned designated for next year's expenditures of 385. That's the amount
13. 7:28that was used to balance the 2026 budget. Uh other is one of 1.032 million. Those are the incumbrances. So those are basically commitments and expenditures we had in 24 that got moved into the 25 budget. Um which gives us a total fund balance of oh and then unassigned uh according to the audited financial statements of 2.197 million. So for a total net of 4.463 million. That's 2025. This is 2025. and 2024 means uh I can't I can't tell you what the well it would have been I I can't remember off the top of my head what the unassigned fund balance was I think it was about the same it was probably 2.4
14. 8:10four and we lost 155. Uh but the loss last year well in 2024 was at 1.3 million drop. Okay. Um so in case you are looking as I know you all do and comparing deeply between the AUD and auditing financial statements, you will notice a significant difference in the unassigned fund balance. That is because New York State requires that any interfund loan that's in place for more than a year be classified as non-spendable which makes sense because it's literally unaccess unaccessible. Well, as we I think all know fund balance is not cash. Fund balance is just the net of assets. You could have a
15. 8:54huge fund balance and it could all be accounts receivable and you could have like no money in the bank. So um but in this case we are actually talking about cash. It's literal cash that gets moved out of the general fund and moved into a different bank account for primarily the capital projects and we wait to get that back. Um SID is one of those SID is one of those. Yep. So right now at the end of 2025 we had a total of $2.068 million in uh inter fund loans.
16. 9:24only 787,000 of that was actually fified as non-spendable. It that pro that number is probably going to go up in 2026 because we've got other loans that have been outstanding that weren't outstanding for a year then but are still outstanding now. Um so basically if you take the unassigned for the audit of the 2.197 and you adjust for the 787 in New York state's opinion we have an unassigned fund balance of 1.4 4 million. Um, and then I know we've talked about this before, but since we have the 25 expenditures, I took the 25 expenditures.
17. 10:02And frankly, as I'm looking at it now, I probably should, oh, I did another one. Um, so we have the, you know, the 2025 expenditures and then the net other financing uses for, uh, grand total in our system. Those are all considered expenditures. Standard fund transfers expenditure. system. Most financial system doesn't have the opportunity for these other sources of use category. Um it's a it's a financial statement category. It's not like a general ledger account category. Um so if I ran a report, our expense our expenses would
18. 10:39look like 15.7 million. Um and you know at the minimum two months that GFOA recommends, that would put us at an unassigned fund balance of 2.6 million. So, so my question to you, when they have this 2.6, they're they're going to be comparing our 1.4 to that 2.6. That's per their calculations based on how they define things, it should be 2.6, correct? So, they're going to be comparing the 1.4 to the 2.6,000. Okay. Yeah. Who is that? Is this the state or is it the rating agencies too?
19. 11:15It will probably be both. the rating agencies will the rating agencies will most likely go by the financial statements, not the the OSD statements. But but in terms of um in terms of our fiscal stress, that's exactly what I'm talking about. Yeah. I mean, we just got our fiscal stress score and we're still fine, but yeah, the next time around, we may not because we'll probably get dinged on the level of is my guess. So, we just got it for the prior year. So, um it'll be a year from now before we really know. For instance, is the unpaid property taxes included in the
20. 11:50fund balance somewhere or is that taken into account? Where is that taken into account? Um, the un the unpaid taxes are a receivable. So, they're an asset. The revenue is all recognized the minute the tax bills go out, right? So, we recognize all the revenue. So, when people say, "Oh, we'll increase revenue if we collect more tax more back taxes." That is not true. Yeah, what you do do is you reduce your asset of receivable and you increase the asset cash. So it's included in the fund
21. 12:21balance to the extent that they are part of the asset side of the balance sheet. That make sense? Okay. Fine. Okay. Yes. Um but but if it's not receivable but if it's it's just it's just a if it's still not receivable then where is it accounted for? It's just a decrease of the asset balance. It's just not what when you when you collect well it's not there like if you have if you have unpaid property tax whatever it is now 1.4 million I mean that's just we're already getting the 1.4 million
22. 12:55next closure proceedings is that you're talking no we haven't got to that you're jumping ahead of sorry you're going ahead okay never mind so it basically you kind of are but you're kind of not but that 1.4 for isn't taxes receivable. That's it's not tax receipt, but it's it's not necessarily I can't answer my question, but it's not accounted for on balance. Well, it it is to the extent that it is one of the components that determines what the fund balance is. Fund balance is basically all of your assets. So, the fact that they're cons they're they're recorded in the general ledger as assets, receivables.
23. 13:36Then you've got all your liabilities, your payables and due tubes and all of those things. The net of those things is your fund balance. That's why fund balance isn't necessarily cash. Like I said, it could be entirely accounts receivable. So you could be asset rich but not have any cash in the bank because all these people owe you money basically. So that's kind of the thing. And the collection doesn't impact that. Um what's the word I'm looking for? Doesn't impact that calculation at all. That's when people pay their back taxes, you're just reducing the asset that's receivable, but you're increasing the asset that is cash. So the actual
24. 14:13revenue we get on that it's interesting is what interesting correct but okay yes but then but then there's still for instance yes the revenue interest but don't we also lose that interest if we had been the bank if we had if we had that interest sitting in our account wouldn't we have gained that interest isn't a net you would have earned interest on the interest sure but at least when they pay off their bill there is that is the new revenue that is new revenue So the taxes are not new revenue, but the interest and penalties that get paid
25. 14:46at the point of time when they were paid off, right? Less legal costs and dues and things like that. Well, to the extent that you're not talking about foreclosure, yes, but to the extent that it's just people who are okay, just paying the back taxes, then it's just pure extra. So speaking of foreclosure, uh unless anybody has any other questions, okay? Um, so the list and petition for foreclosure has been filed with the city clerk's office. A list is available in my office and the office of the city attorney or maybe it's just the attorney that's um doing the foreclosures. I'm not sure. Um, I did
26. 15:22update the list as of 924 and put it online. Um, the notices have been issued to the property owners. So, we're probably about 3 months away at this point from foreclosure. Um, we are down to only 15 left on the list. That's great. And uh but it's still about 1.4 million 950 principal and 480,000 in um interest, aka new revenue, aka new revenue. Um and if I I I looked at this today and I already can't remember, but I want to say that maybe the top five properties are probably about 70 to 75% of the total. because there's just a couple really big ones
27. 16:04still out there, but the um several came off including the church um which I think I mentioned last time and a couple other big ones came off. So, so yeah, 15's a lot better than 152. That's great. Thank you very much. Yeah, that's a really good job. Yeah, you'll see that like in the 25 even the auditors. It's funny because based on our discussion, you would very very very junior baby auditor and he actually asked and I wouldn't necessarily expect you guys to to not ask this but as a working on government
28. 16:38financials he wanted to know why why did interest and penalties go up so much when receivables went down and I'm like because we wanted it. Yeah. So that was amusing. So, so we did have, you know, we had um a nice bump in interest and penalties both for uh city taxes and also the school taxes. And we also for when we collect the school taxes, we also get a 5% fee on top of everything, which is not nearly enough for the work that we have to do on the school's behalf, but it's better than
29. 17:09nothing. Um so you will see that that those were pretty nice increases in 25 and I expect to see that in 26 as well. Um, I mean going forward in terms of collecting property taxes, is there like a process or procedure that's different than before or I mean is this the same number of notices or what? Yep. Yep. Sure. And we issue a tax bill at the beginning of the year. Uh that's the only back tax bill they get. Then we get the school taxes, the del school taxes in November and then we issue a statement to everybody that has any kind of delinquent taxes and that goes out in
30. 17:47the middle to end of November and then we start all over again. You know, I would say the one thing that would be an improvement is to not wait 8 to 10 years between um process. Enforcement is a big thing. Yes, enforcement is huge. And you know, we had a challenge with getting approval for that for quite some time. And you know, it's not just it sounds like maybe, oh, that's the city being greedy and wanting to foreclose on people, but in reality, it's it's much easier for
31. 18:17somebody to deal with the fact that they're $5,000 behind than $45,000 behind. You know, even even the issue of coming up with the down payment for an installment payment plan. And we've had at least two or three other people since the last meeting enter into an installment plan. So that's another reason why people have come off the list. I totally agree. I like the city doesn't want your house, you know. They rather look. Yeah. Any questions on that? Did you say you were going to go back to cannabis? I just curious. Did you say you were going to go back to cannabis tax income?
32. 18:54No, I said sales tax and we talked about that. Okay. Yeah. I don't I don't have any insight on cannabis. So when they made the when they made the projections based on cannabis tax and income, what are the projections based on? Just the first year was like looking at other municipalities and and um then we all know that was way overstated. Uh this one was looking at the amounts that we had gotten in for the first three quarters and basically flatlining it off of that. But you know we were averaging roughly 40,000 a quarter. So that's where you get to the 160 budget
33. 19:28estimate. The last quarterly payment we just got in was $18,000. So I don't know if it was like, you know, it was a big for that was April to June. I think so. Yeah. Um and you know, I've been in touch with that. Did any other uh return? I don't know. And the one on I don't know. It's been there a while. I would say fairly close to the ones in Hudson open. So it was definitely after the ones in Hudson open but it wasn't very I think some of the projections had to do with the fact that
34. 20:11they might have prophesized that court might not allow it. So they thought this could be it could just be the only show in town. I think when when the media was doing this last year it really was what they were saying. It's like what this sport looks like. So we times for it. Yeah. And I'm just wondering if there's there may be more in Great Barington since fall off that much in that quarter. There has to be there's also like the the informal economy still exists.
35. 20:42It's not everybody from Hudson is not buying. Yeah. I just wanted to as they say on the gentleman, you can have the legal side. It does not eliminate the illegal side. It's just that silence. together is what happened um in the environment between the first quarter and the second and I don't think we have an answer to that. I I did talk to Michelle Fuches. She's the one I mean she will tell you frankly that it's frustrating dealing with the Office of Cannabis Management and getting clarity and information from
36. 21:10them. Um but yeah, she really doesn't doesn't really have much sense either. I mean, it could be just as simple as market saturation and you know, it was like it was a new exciting thing, you know, when it first became legal and we all went out and bought, you know, 500 bucks worth of pot because it was legal and then we're like, yeah, you know, maybe this isn't my thing and then you're just going again, right? So, um, is I'm not saying I did that. Is this is it a fine that you're talking about here? Was this seen in other municipalities as well, you know?
37. 21:40I mean, I can tell you that there used to be a line around the block in Great Barington, Massachusetts that doesn't exist anymore. There used to be a line around the block. Oh yeah. In Great Barington, Massachusetts. It's just a trend that's kind of over, right? Okay. And I do think you can find it in every corner. Yeah. Now the main thing. So yeah, I mean I think that's it. And it's going to be super interesting and and you know with this one that's supposed to be opening up now right behind City Hall. I mean I will not be surprised if they're not all in business, you know, 3
38. 22:11to 5 years from now. But great for the consumer. We shall see. I mean, at the end of the day, it's a business. They've got to figure out how to run it, make a profit. I think we should be very cautious in our um productions. 200,000. And if we if we could find out if this is like, you know, what you're saying over if this is something that's defined in other places throughout them, that would be very conscious. Yeah. Yeah. And then the other part of that is when your food budget is increasing every month, you might
39. 22:50Yeah, that's a good point. You give up your smoke, so you give up your You can't eat after you smoke. I can't afford the Doritos anymore. It's like that. Okay. Funny, but it's not. No, it's not funny. Um, okay. Anything else on that category before we move forward? No. No, not on. Okay. Um, okay. So, sale of 98 pattern place. It's been on the agenda for a long time. We do have a bid package that's been prepared by corporation council. Um, you read on a bid date with the mayor's office of October 30th. So, hopefully
40. 23:27shortly after that, that product will be out in the city's hands. We will have the revenue to make up those back taxes, which is about $220,000 and change. Um, and of course, you know, as I think we all know, we're no longer allowed to keep the excess. So, this is going to be an interesting experience to figure out how we figure out how to assign the expenses that we're allowed to sign and there's not a whole lot of, you know, examples out there to follow. Was this our first sale after the Supreme Court case?
41. 24:01And if we can recover the expenses of the lawyer, right? Yes. But then the question is how do you determine what the cost of the lawyer is versus the work that they've been doing across 152 properties and then 80 properties and then 70 properties and you know so um I believe that the law does give us the ability to uh just use a percentage either a flat dollar amount or a percentage and if I am correct especially for some of the ones that owe a lot the percentage may actually be the way to go kind of yeah so we don't get any compensation with work that you're up to.
42. 24:37Yeah. Uh still working on retirement gold standard. Uh I did get an email from PGA Keeler this week saying that Airbnb did in fact confirm to him that they are paying back the guests that paid the uh city tax when they weren't supposed to. Um so that's good. That seems like that's resolved now. Um, got a meeting next week on this integrated online payment system. So, I'm hopeful that we might even be able to get that done before the end of this year. Um, you'll see when we get to resolutions next month. We're at the point now where um, we're pretty solid um, with Peter Frank
43. 25:18and his new city parks team in terms of not just the project cost for that Oakdale Park, but what they're going to need in terms of cash flow uh, short-term and long term. So short-term, I think we figured out a way with maybe, you know, roughly a quarter of a million dollars in her fund loan, which we couldn't have swung 6 months ago, but we are in better shape now cashwise, at least for now. Um, and then there'll be a bond resolution, but it'll be a bond
44. 25:43resolution because it's always a bond resolution, but it's really going to be a ban because once again, this project is supposed to be fielded entirely with grants as well as the city contribution and the bogey contribution. So there shouldn't be anything longterm to bond. And also it appears what we've been told they're trying to do it on a five times bill their own money back. You know they loan money that we're putting up front so they can get reimbured. It doesn't seem like it's something that's trying to drag on years. You know what I'm saying? No, we should not drag on this.
45. 26:21Yes, we are still in the middle of something like that. So yes. um at some point, you know, literally we just finished the audit today and we've already started the budget season, so I am quite a bit behind. Um so, keeping the city debit card concept on here, but haven't gotten to it. Um so, I just attached for you to more detail the balance sheet for the general fund. It's got some other ones as well. Capital, water, uh, and the, uh, income statement, which is the, uh, following one where you can
46. 27:00see, uh, the drop of 155,000 versus a year ago. And then, did I skip over the budget thing? Well, you know, we're all in the middle of, you know, we just started the budget. Um, so all of the departmental budget requests are online under the treasures section of the website and under if you scroll down where all the documents are. So I brought put those all online so that the public at the whole can see them or view them before, during or after the meeting should they care to participate. And what I did here
47. 27:31for you guys is just to give you a sense is and this is just departments. It's obviously not the whole budget because it doesn't have you know the other half of expenditures. Um but just to give you a sense of you know for each department what their 26th adopted budget was what their 27th request is and what the change is both in dollars and percent. So you can get a sense of what the initial end was. Yeah, the snow situation is bad um because of the
48. 28:11market this year where we have basically spent all of our money. Um so I'm not surprised to see that going up. We we we used last year we used an average of over two years rather than a trend like a rolling trend and the previous year had not been particularly bad. So we're we're probably going to have to do some amendment in the next part second part last part of this year because we have no money left. That number might be about 80. Sorry, that additional number to get us to the second half of the winter snow removal might be running was a fair estimate
49. 29:01four months ago just would completely run out and you can't foresee what's going to happen. No, you can't. Right. each week. There are some predictions on the weather that next year starting January might be actually unusually warm. Yeah, that as well due to some jetream changes. Not good for the overall climate, but maybe good for the city of No, not at all. And and the Midwest. And the Midwest. It all affects us, right? It all affects us. We get a lot we get a lot of our food from there. So, it affects us significant.
50. 29:53That's all I have. So, it's great. Thank you. Did you have questions on the benches? No. Wait. We have a question. I have a question. We're It's about a resolution we're looking at tonight. Um, last year when the council got the doc operation contract, uh, the council asked for financial reports every month. Has the this committee received anything from the dock operations for the summer or the doc programming because it would be really helpful to have any numbers whatsoever if we're going to vote on resolutions. So we for the next management structure we have which seems
51. 30:34to be heavily focused on the programming aspect more than the doc operations and I'm just curious I have if you see any paperwork I have I have not and I just got kind of an urgent message that I need to talk to about okay thanks that's all I was going to talk about in the next meeting question the fact 152 two properties that was 3 million in red on the bast correction correct and mentioning that there's she $4,000 now. Yeah. Can I can I just need to tell um mention there is $4,000 set aside for marketing tourism.
52. 31:23Yeah, it's a little more than that. It's basically what's left from actual tourism reserve. Um, so if you know there's no, as far as I'm believe there is no conflict with using those funds because those funds were expressly set aside for the use of promotion and res. Um, but that's that that's going to wipe that out. That's the balance that we have done for because we took $30,000 out of it for 2026 to fund the citywide promotions. Got it. Okay. So So that money is all available.
53. 32:04Yeah. I mean there's whatever's in the budget. I can't remember exactly like 4 roughly 4700. That's what's left in in the actual legal reserve that was established. So they use the back in 2027. They'll wipe that out. Okay. Okay. Anyone else? Any questions? No. Okay. I think that we're going to take a short break until Mar. You don't have anything more for me. No, we're good. Thank you very much. Thank you. Do you want to continue this meeting or it's coming? meeting is well we can we can it's fine next
54. 32:47to second okay great motion thank

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