Modified: May 4, 2020 9:07am
Created: May 4, 2020 9:07am
Erie County Executive must submit a plan in seven days to erase the budget gap
(ERIE COUNTY, NY) – Erie County Comptroller Stefan I. Mychajliw Jr. declared a deficit for the County of Erie as of May 4th, 2020. The authority to declare a deficit is granted under Section 2511 of the Erie County Charter.
The Erie County Executive is obligated under the charter to provide the Erie County Legislature with “a written proposal of actual remedies to overcome the deficit” in seven days.
Once the Erie County Executive provides a written proposal to overcome the deficit to the Erie County Legislature, the Comptroller will have seven days to submit “written comments” concerning the County Executive’s plan.
Following that time period, the Erie County Legislature has 21 days to act on the Comptroller’s written comments and the County Executive’s deficit correction plan.
If the Legislature fails to act, the “County Executive’s proposal shall be deemed adopted” according to Section 2511 of the Erie County Charter. This Charter mandated process was put in place following the “Red-Green” budget crisis.
Comptroller Mychajliw’s deficit declaration was sent to the Erie County Legislature. It advised them that as a result of expected revenue losses connected with the COVID-19 pandemic, Erie County will now operate at a deficit for the first time since the “Red-Green” budget crisis of 2004-2005.
In his deficit declaration, Comptroller Mychajliw stated that revenues projected through the end of this year will not meet amounts appropriated.
According to the Erie County Charter, the Erie County Comptroller is obligated to make this declaration to the Erie County Legislature if the year-end deficit is projected to be more than 50% of the County’s undesignated, unreserved fund balance at the end of 2019. This is commonly called the government’s “rainy day fund” or savings account.
Because of COVID-19 related business closures and the shut-down o the economy, sales tax revenue is expected to fall nearly $128 million short of projections. The County Comptroller said that this, along with an expected 20% cut in state aid, as well as a loss in other revenue sources means at this time Erie County can expect a shortfall of $206 million, given current conditions.
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