New York Governor Andrew M. Cuomo outlined a proposal for creating a Financial Restructuring Board to assist distressed local governments in managing their finances.
In his presentation, the Governor said that more money was not the solution.
He said the state’s AIM (Aid and Incentives for Municipalities) program neither reflects performance nor the needs of local governments, even though it accounts for a huge share of the big city budgets (excluding NYC).
For example, Buffalo’s $161.285 million in AIM funds makes up 33.21 percent of their $485.621 million FY 2013 budget. The percentages for Yonkers (24.46), Syracuse (24.07) and Rochester (18.06) are similarly high.
Gov. Cuomo said that it was time to stop talking about it, and start doing something. He added that Albany was different from Syracuse, which was different from Buffalo and Jamestown and so on.
The Governor said there was no one size fits all solution, and they needed to bring each one in and work with them to come up with an individual restructuring plan for each locality.
Jamestown Mayor Samuel Teresi noted that this was the first attempt ever at understanding the structural economic problems that cities and local governments in the Upstate region have faced for generations.
The plan involves the creation of a Financial Restructuring Board comprised of one restructuring professional from the private sector, accompanied by state officials including the Sec. of State, Budget Director, AG and Comptroller.
Their first task would be to come up with the standards for defining fiscally distressed local governments in New York. The eligible candidates could then request assistance from the board and work together to develop a restructuring plan.
The board would have $80 million to work with, allocated in the FY 2013-14 Budget for reorganization plans. If a local government accepts funding, the recommendations made by the board would be binding on the recipient.
Apart from drawing up detailed financial plans for several years, other measures the board is expected to push for include use of shared services, functional consolidation and mergers, and reduction in the number of public officials.