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BUFFALO NEWS Don't Spend Extra Cash, Fiscal Chief Implores Comptroller Says County Needs Reserve By MATTHEW SPINA News Staff Reporter 7/12/2006 The comptroller who popularized the term "debt diet" - as in Erie County needs one - nonetheless sided with the county executive Tuesday in saying officials should not raid this year's pot of extra cash just so they can borrow less for major summer projects. County Comptroller Mark C. Poloncarz came down squarely against the Legislature and the state-appointed control board when they urged Joel A. Giambra to spend this year's extra income so he can borrow less to repair roads, bridges, roofs and other amenities. "I don't want anyone from the administration, the Legislature or the Fiscal Stability Authority saying, "We have some extra money lying around, now let's use it,' " Poloncarz said Tuesday, after distributing a letter explaining his position. He said the government should always try to borrow less and spend less, but he doesn't want expenses paid with one-shot revenue - in this case, reserves. In short, Poloncarz said Erie County can better repair its worse-than-mediocre credit rating by accumulating rainy day money, about 5 percent of its total budget. The other reason: Should this year's feast turn to famine, officials will need the savings for everyday expenses. Sales tax income, income from investments and savings from vacant jobs have combined to put the government $10 million better than budgeted as of May 31. Medicaid also will cost $12.7 million less than forecast this year because of the way state officials compute their cap on each county's Medicaid cost. Erie County's decision-makers have wrestled for weeks over how much to borrow. Taking cues from a control board alarmed by the government's debt load, the Legislature told Giambra it will borrow no more than $12 million while his wish list outlined $22 million in needs - still far less than what Giambra had requested and received in past years. All sides drew lines in the sand. Giambra refuses to trim his list. Lawmakers also refuse to trim it, in part to avoid squabbles over projects in members' districts. The control board, meanwhile, has urged lawmakers to stand firm and turned up the heat on Giambra and his budget officials. It's debatable which practice has been more destructive to the government's financial health in recent years: borrowing too much or plundering the savings account until it ran dry at the end of 2004. But on Tuesday, the control board was not continuing to debate. Its new executive director said the Legislature will do the right thing. "I think that what the Legislature is looking at doing is within the spirit of what the authority had proposed - that is reducing the borrowing, reducing capital projects, and looking at the potential for pay-as-you-go," said Executive Director Kenneth Vetter, Giambra's former budget director. "But as to the vantage point of the Stability Authority, reserves are important, and they are important to Wall Street." He also said that if lawmakers are looking to use cash on hand for small-scale projects - those generally costing less than $100,000 - they will not affect the county's bond rating. While Giambra has listed some expensive repairs - $2.7 million for the continued rehabilitation of Ralph Wilson Stadium, for example - he also wants to borrow just $38,000 to design five bridge-repair projects in Tonawanda, Clarence and some other towns, and $70,000 to improve drainage along Sawyer Avenue, Kenmore Avenue and Two Mile Creek Road. "For smaller ticket items, pay-as-you-go makes more sense," Vetter said. The matter is heading toward a showdown Thursday, when the Legislature is expected to act on the formal resolution to sell bonds. Some lawmakers, such as Legislature Chairwoman Lynn M. Marinelli, D-Town of Tonawanda, suspect Giambra has held extra money from old projects that came in under budget, and he can use those dollars. Legislator Kathy Konst, D-Lancaster, has introduced an even harder line than the $12 million cap on borrowing. She suggests lawmakers borrow just the $7.2 million in repairs mandated by contracts - such as the stadium improvements - and let Giambra decide how to finance the remaining $4.7 million from that pot of unexpected cash. e-mail: mspina@buffnews.com Copyright 2006 - The Buffalo News |
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