Poughkeepsie… Dutchess County Executive William F.X. O’Neil announced the County’s 2022 year-end financial report has been submitted, as required, to the New York State Office of the Comptroller. Thanks to the County’s continued responsible and conservative fiscal management, in 2022, Dutchess County Government was able to utilize historic fund balance reserves to deliver tax relief to residents and businesses. Additionally, the County paid down debt and avoided new debt by utilizing fund balance for several significant capital projects. As outlined in the year-end report, the County’s current fund balance totals a healthy $72.5 million, providing some ability to mitigate negative economic impacts or new cost shifts from the state or federal government.
County Executive O’Neil said, “I am grateful to our dedicated, steadfast fiscal management team who guide our policies, strategies, cash flow and budget. Together with the County Legislature, we have built a solid fiscal foundation for Dutchess County’s future with smart choices and careful, conservative management. We need to be ever vigilant as we know how quickly conditions can change, particularly as New York State seeks to push down more costs on to county taxpayers in the 2023-24 State Budget.”
General fund balance is an important measurement of the County’s fiscal stability, as it serves as a “rainy day” fund to help insulate the County from the impact of unforeseen economic downturns or unexpected costs. The County adheres to a fund balance management policy of maintaining 1-2 months of operating expenditures, or approximately $49 to $97 million. If general unassigned fund balance exceeds two months of operating expenditures, the policy states the County will use general fund balance to:
• Pay down debt;
• Avoid new indebtedness; and/or
• Provide property tax relief through offsetting current year operating expenses.
In 2022, with fund balance reserves totaling $119.5 million, the County did all three – cut taxes, paid down debt and funded critical projects with cash rather than financing through bonds.
2022 fund balance use highlights include:
• Dutchess County’s property taxes were reduced in both the 2022 and 2023 Adopted Budgets. The County property tax levy is the lowest levy in 14 years and the property tax rate has been reduced 32% since 2015.
• Sales tax on clothing and footwear items less than $110 was eliminated. Dutchess County is one of the only counties in the Hudson Valley region to offer this clothing and footwear savings.
• All eligible, callable debt was paid off.
• Capital projects that normally would be financed through bonds were paid utilizing fund balance including:
o Emergency Response vehicles ($2.1 million)
o Countywide interoperability 2-way emergency response radio project ($3.4 million)
o Camp Nooteeming property purchase and improvements ($4.8 million)
o Replacement of County roofs ($2 million)
o County building improvements ($3.5 million)
o Northside Line trail funding ($2.5 million)
o ADA Accessibility projects ($1.5 million)
o Network infrastructure, Board of Elections printers, capital vehicles and equipment ($2 million)
o Capital projects for Enterprise funds ($1 million)
Additionally, the County established the Housing Trust Fund with $12.3 million in unassigned fund balance set aside in a restricted reserve. $9.3 million of the Housing Trust Fund will come from federal American Rescue Plan (ARP) funds, and as the funds are spent and ARP revenue can be realized, those dollars will be returned to the unassigned fund balance over the next three years.
Looking ahead, as the Governor and State Legislature work to finalize the 2023-24 New York State budget, Dutchess County Government faces multi-million dollar impacts as the State seeks to take back funding and add new costs for county governments. Although the State Budget agreement has been reached, specific details have not yet been released. Dutchess County is facing new annual costs totaling nearly $10 million, including $5-6 million as the State pulls back federal Medicaid funding intended for counties. Additionally, it is believed the State will also renege on $25 to $30 million due to the County for prior year Medicaid expenses.
County Executive O’Neil highlighted the County’s concerns about the Medicaid funding shortage and other unfunded mandates in a letter to New York State Governor Hochul earlier this week.
“With new costs coming down from the State, maintaining a solid fund balance is critical to managing and adjusting to external financial impacts on the County budget and finances. We will continue to carefully monitor the County’s expenses and adjust to changing circumstances as necessary. We may be facing tough decisions ahead as New York State’s fiscal climate is uncertain, and history has shown that the State often resorts to foisting its costs on to local governments, without regard to the impact on local taxpayers,” O’Neil concluded.
The full 2022 Annual Financial Report and accompanying fiscal update memo to the County Legislature are available on the County’s website at dutchessny.gov.
