News & Events

Thousands of towns face budget squeeze in downturn's wake

Sean Mulvey, the newly appointed finance director for the town of East Greenbush, N.Y., is trying to solve a riddle facing cities and towns across the country.

Though property tax revenues in the Albany suburb have yet to recover from the worst housing collapse since the Great Depression, fixed expenses like long-term contracts, debt interest and pension costs are squeezing the town’s budget.

To make matters tougher, New York state recently enacted a law limiting tax increases by local governments and school districts to no more than 2 percent or the rate of inflation, whichever is less.

“Our reserve funds have been helping to take of care of some of the problem, but they’re starting to come to the point where we are looking to refresh them if possible,” said Mulvey. “If there’s a pot of gold around here, I’d love to have someone show it to me.”