City of Buffalo borrowing to close Fiscal Year 2019-2020 budget deficit approved
June 18, 2020
Buffalo Comptroller Barbara Miller-Williams responds to the adoption of the financial measures approved to close out the 2019-2020 fiscal year during a Common Council Special Session this morning. Per the Comptroller’s analysis of the City’s third-quarter Gap Report, a projected budget shortfall would approach $18 million at the close of the current fiscal year.
“These continue to be unprecedented times for municipalities across the country facing the financial impacts of the Coronavirus Pandemic,” said Comptroller Miller-Williams. “After careful review and consideration, it was determined that a Revenue Deficiency Note remained the most cost-effective approach to cover the City’s budget shortfall.”
A revenue deficit happens when the actual amount of revenue falls shorter than the estimated amount budgeted in the current fiscal year. Therefore, to mitigate the shortfall, the City of Buffalo is allowed to borrow up to 5% ($25 million) of its current year budget of $509 million. The Common Council has approved a Resolution for the City to borrow $18 million at a 1.22% interest rate through lender JPMorgan Chase, N.A. The borrowing allows the City of Buffalo to close out fiscal year 2019-2020 with a balanced budget.
“As Comptroller, it remains my obligation to execute conservative measures that protect the City of Buffalo’s tax payers and citizens from a financial perspective,” Miller-Williams said.