Mayor Lauds Village Managers for Exemplary Fiscal Management During Difficult Times

sunsetIn any given year, creating and passing a budget for the following fiscal year presents many challenges. In 2020 however, this budgeting process is even more difficult, as the Village of Scarsdale faces severe pandemic-related revenue shortfalls and COVID-19 expenditures. On Tuesday, December 15, 2020, the Village of Scarsdale Board of Trustees held their first budget work session to discuss the 2021-22 budget via Zoom Video Conferencing.

To get a jump-start on this unusual year, Village Manager Stephen Pappalardo began the budgeting process early and requested that his department heads submit their 2021 operating budgets one month ahead of schedule (by November 30th instead of December 31st). In order to prepare for various case scenarios, department heads were asked to create 3 budgets – one accounting for the same level of funding from the previous year, a second with a reduction of 5%, and a third with a reduction of 10%. These variations will assist the Board of Trustees in their decision-making process in the event of budget cuts for the 2021 fiscal year.

The primary speaker of the evening’s meeting was Ann Scaglione, Scarsdale’s new Village Treasurer. Ms. Scaglione reviewed the financial state of Scarsdale and what the future versions of the budget might look like as a result of the town’s revenues and expenses this year. Because of the COVID-19 pandemic, several departments did not meet their estimated revenue goals. Areas such as the Scarsdale Parking Detail and Fines and Forfeitures failed to bring in the same level of funds as in a typical year ask parking and meter fees fell sharply. Additionally, the Parks and Recreation Department faced revenue shortfalls largely caused by the cancellation of Scarsdale Day Camp this past summer, resulting in $630,697 in lost revenue.

In total, Ms. Scaglione projected that village revenues will fall short of original estimates by around $5.5 million. She also shared that Scarsdale saved money in a variety of ways throughout the pandemic. Ms. Scaglione estimated that the town will come in under budget for expenses by approximately $4.0 million. Overall, the village has a projected year-end deficit of $1.34 million, but came into this fiscal year with a fund balance of $1.52 million.

During this time, an important cost-saving measure was reducing Scarsdale Village’s personnel expenses. Decisions such as the choice to decrease the number of employees hired for leaf collection, reduce overtime, keep some part-time and intern positions open, and cancel events such as the Fall Scarsdale Tree Planting saved hundreds of thousands of dollars for the village. In addition, departments such as Public Safety, which includes the Fire and Police Departments, came in under budget this year by over $528,000. Savings were also realized from reductions in the Village’s payment to state retirement and pension funds.

On the revenue side, a strong real estate market resulted in the highest amount of mortgage tax revenue we have seen in years, with $405,429 in September, more than double the prior year. Also due to an increase in county sales tax those funds are up as well.

After Ms. Scaglione reviewed the financial state of Scarsdale, Mayor Marc Samwick noted the “exemplary management of the crisis” by village leaders and stated that “the long-term fiscal management of the village has served us well in these difficult times.” Trustee Justin Arest followed with a question on how sustainable it will be for the town to maintain their departments at these decreased funding levels. Additionally, Trustee Arest commented that he “appreciated the 5% and 10% budget exercise (because) it reinforces great fiscal management and the position that (the town) is in will lead to some tough decisions” in the future.

Trustee Jonathan Lewis echoed this sentiment and highlighted the uncertainties Scarsdale faces in the coming year. He noted that “if there aren’t any changes [to revenues in 2021] we will be faced with the tough choices of drawing down reserves, tightening expenses, or raising taxes.” Trustee Lewis also pressed for the need to prepare for the worst-case scenarios and said that “updates with the [COVID-19] vaccine will influence our decisions in real-time and we should have flexible frameworks to deal with these changes.”

Finally, Trustee Lena Crandall stated that “we need to be careful with our taxpayers’ hard-earned dollars” especially given that New York State and the federal government might look to them for “increased] personal income tax payments.” She closed by emphasizing the need to “keep Scarsdale an attractive and safe place to live.”

At the end of the meeting, Diane Gurden, a board member to the League of Women Voters of Scarsdale, read the following statement:

The League of Women Voters of Scarsdale Board of Directors (the “League Board”) appreciates the opportunity to comment at the outset of the Village Budget process. As the League has only started to engage in its observation and study of the Fiscal Year 2021-22 Village Budget process, the following recommendations have been coalesced from past League of Women Voters of Scarsdale consensus statements.

The League Board understands that due to the global pandemic, the Village has moved to austerity spending, which will remain in effect throughout the 2020-21 fiscal year. In addition, department heads have been directed to restrict spending to essential items required for the operation of the Village and for their response to the current pandemic. The League Board recognizes that there have been, and will continue to be, impacts to revenue as a result of the COVID-19 health crisis and that the Village Board and Administration will continue to evaluate and look at the current budget as the year progresses.

Now that the 2021-22 budget process has begun, the League Board recommends that the Village Board and Administration engage the community in a timely manner to ensure a proactive, practical, public dialogue regarding the revenue generation options and potential cost savings under consideration. The League Board recommends that the Village Board and Administration seek community input and ascertain community sentiment while making budget choices that may potentially affect service levels and impact Village tax rates. Similarly, regarding long term capital spending, the League Board encourages the Village Board to clearly detail which projects will be funded in the 2021-22 budget as well as which projects must be delayed, and to establish, along with the community, a timeframe to plan for long term infrastructure needs. We encourage the Village Board and Administration to provide clear, concise, transparent explanations of Budget decisions, in addition to a broad overview of what is needed to maintain and improve our Village infrastructure, so that the community will understand the Village Board’s proposed Budget priorities.