Slow or no revenue growth has made it difficult for many local governments in New York State to maintain services while dealing with rising costs, according to a
"New York's municipal governments are seeing sales tax revenue growth slow and state aid remain essentially flat while they and school districts are coping with tax cap and tax freeze initiatives that limit growth in property taxes," DiNapoli said in a statement.
Since 2010, local government spending has increased between 0.9% and 2% annually, the report showed.
School district spending remained below 1% in 2011 to 2013, but started to rise in the past few years because of increased state aid to schools.
Local sales tax revenue growth fell to 1.8% from 3.6% in the first nine months of 2016 from the same period in 2015, the report said, adding that counties are particularly reliant on sales tax revenues.
School districts, towns and villages, meanwhile, rely on property taxes for about half of their revenues. The 2012 property tax levy limit restricts property tax revenues for increases in local spending. In the past few years, the tax cap's allowable levy growth factor has been less than 2%, the report said.
Despite these financial pressures, fewer local governments have been designated in fiscal stress under DiNapoli's fiscal stress monitoring system, the report said.
There was a low frequency of stress seen in towns and villages, while counties and cities showed more signs of stress and school districts remained stable.
"Local governments have been able to balance budgets, even while many have expressed concern that the quality of local services may be suffering," the report said.
