Places restrictions on the Buffalo Fiscal Stability Authority's ability to impose a wage and/or hiring freeze upon the city or covered organizations or employees thereof

Title of bill

An act to amend the public authorities law, in relation to placing restrictions on the Buffalo fiscal stability authority's ability to impose a wage and/or hiring freeze

Purpose

This bill specifies conditions under which the City of Buffalo will no longer be required to impose a wage and/or hiring freeze upon itself or on members of any collective bargaining organization.

Summary of provisions

This bill stipulates the exact conditions under which the City of Buffalo and collective bargaining organizations would no longer be required to adhere to a strict wage and hiring freeze.

Section 1 of the bill specifies that the Buffalo Fiscal Stability Authority cannot impose a wage and/or hiring freeze upon the City of Buffalo or any covered collective bargaining organization or City employees if the following conditions are met: the city of Buffalo adopts a balanced budget; the city of Buffalo pays the interest on any of its bonds or notes when due; incurs an operating deficit of less than 1% in the aggregate resulting from operations of any major fund of the city of Buffalo or a covered organization assuming the Financial Plan is reported in accordance with Generally Accepted Accounting Principles; and the City of Buffalo does not violate any provisions of the original Buffalo Fiscal Stability Authority Act of 2003.

Section 2 of the bill stipulates the effective date (immediately).

Justification

The City of Buffalo has a much improved financial situation compared with four years ago. The City of Buffalo has a total fund balance totaling approximately $95 million before designations and approximately $9 million for reserves which represents 28% of total fund expenditures. In fact, Buffalo's total fund balance has increased steadily since 2002-03. The city of Buffalo has reduced its workforce by nearly 800 since 2001-02 demonstrating the seriousness of its financial situation at that time. Furthermore, in February 2007, Moody's Investors Service followed Standard and Poor's decision and upgraded the city of Buffalo's General Obligation (GO) bond rating, from Baa3 to Baa2, the highest rating from Moody's since 2001. In December 2006, Standard and Poor's, highlighting the City's improved financial condition, beneficial financial management practices, and the continued effective oversight exhibited by the Buffalo Fiscal Stability Authority, raised the City's investment grade rating to BBB (stable), the highest rating since 1999.

Legislative history

New Bill. This bill amends Section 3858 of the Public Authorities Law enacted in 2003 (Chapter 122 of the Laws of 2003).

State fiscal implications

None.

Effective date

Immediately.