The City could use the surplus for purchases; paying off debts – Daily Freeman

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KINGSTON, NY — The city could use nearly $1.5 million of its fund balance to purchase equipment and vehicles and pay down short-term debt.

Spending part of the fund balance would reduce future debt service payments and interest costs paid by ratepayers, City Comptroller John Tuey told the city council’s finance and audit committee at a meeting. last week. He said the spending would also be in line with the city’s balanced-funds policy.

“Our fund balance policy calls for the city to take action when the fund balance exceeds 20% of the following year’s expenditures,” Tuey said. He said the city’s fund balance was 21.86% of budgeted spending for 2022 as of Dec. 31. That would mean the city would have to consider spending about $900,000 of its balance to comply with the policy, Tuey said. He said, however, that he recommended council authorize greater spending because the city’s sales tax revenue is already very ‘strong’ for the current fiscal year and is expected to exceed budget again. .

Tuey said the city ended 2021 on a solid financial footing, with sales tax running nearly $4 million over budget. There was also an additional $800,000 in mortgage registration taxes, state assistance that was reinstated and $400,000 in funding from the Federal Emergency Management Agency, he said.

“This tsunami of windfall revenue has created very favorable results for 2021,” Tuey said.

At Tuey’s request, the committee moved a resolution authorizing the city to spend $1,484,132.11 of its fund balance. The resolution still needs to be voted on by the full council, which meets again next month.

Tuey said $859,132.11 of the financing would be used to fund equipment and vehicles that have been purchased but not yet borrowed. He said the city was allowed to borrow for purchases but the bond hadn’t ended.

The other $625,000 of the fund balance would be used to pay off part of the city’s short-term note that matures in August 2022, Tuey said.

Tuey also said he and Mayor Steve Noble would return to council with further suggestions for spending the remaining funds in a manner consistent with city policy. He said that includes considering spending that won’t create recurring debt and save taxpayers money.

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