The city of Buffalo, N.Y.'s finances are improving, but challenges remain, according to a report released by State Comptroller Thomas P. DiNapoli.
"Buffalo's finances are trending in the right direction," said DiNapoli in a press release. "Sensible budgeting, improved revenue growth and increased economic development are responsible for the city emerging from years under a financial control board. The leadership of Mayor [Byron] Brown, city officials and members of the oversight board has been instrumental in creating a positive fiscal outlook for Buffalo, but there are a number of red flags they should be wary of moving forward. I urge city officials to continue their cautious fiscal approach and be vigilant when it comes to long-term financial planning."
While its economy and finances have improved in recent years, "Buffalo certainly faces some significant challenges, both demographically and financially," Buffalo Comptroller Mark Schroeder said in a press release. He noted, "the Buffalo Niagara Medical Campus, the recently announced high-tech manufacturing hub at Riverbend, and the development of waterfront attractions such as Canalside and HaborCenter are reshaping and revitalizing Buffalo's economy at a pace not seen in decades. The city's general fund balance is $166 million, the highest in Buffalo's history, its debt burden has been reduced by more than $120 million in the past decade, and aggressive debt refinancing has led to savings of more than $66 million in interest costs."
Revenues are up 20% in the past decade, which allowed the city to bolster its rainy day fund, which provided money for the city in the past five years. "The city's available fund balance peaked at $113.5 million in 2008 and stood at $30.5 million in 2012," according to a release.
The Buffalo Fiscal Stability Authority became an advisory service in July 2012, after the city posted three consecutive fiscal years of balanced budgets and gaining access to the debt market.
Despite the positives, "several negative demographic factors" remain, DiNapoli said in the release, including: debt service of 10.9% of total revenue, below average median home value, median household income, the child poverty rate, and a drop in population through 2010, during which Buffalo remained the second-largest city in New York.
