Buffalo Fiscal Stability Authority Vote to Lift City Employee Wage Freeze

The lifting of the wage freeze today recognizes that the Buffalo fiscal crisis is ending.

It recognizes extremely tough choices made since the beginning of the city’s fiscal crisis, including:

· Scores of efficiency and productivity improvement measures, and
· Significant restraint in City budget growth, which, in certain year –including FY 2007-08 – has been below the rate of inflation.

But, perhaps the sacrifices of our employees have been the most significant, including:

· A hard freeze on employee raises, longevity and promotions since April 22, 2004 when the Control Board imposed a wage freeze, and
· A 30% reduction in City personnel since 2001 has meant each and every employee has had to do more with less.

Despite these sacrifices, our city employees have worked harder without compromising their sense of duty and commitment, and for this our workers should be recognized and thanked.
 
This lifting of the wage freeze we are approving today is one small step in recognizing the sacrifices of our workers over the course of the fiscal crisis.

The budget and four-year financial plan the BFSA approved today, along with the lifting of the wage freeze, demonstrate that the fiscal crisis is ending, significant changes have taken place in the culture of city government and my Administration is committed to continuing prudent fiscal management practices that will endure well beyond the life of the control period.  These progressive fiscal management practices will provide the safeguards that will prevent any future fiscal crisis.

This is truly a “turn around budget”: 

· For the first time since the beginning of the control period, the budget is balanced without the use of one-shots or the need for gap closing measures;
· The 2007-08 budget will mark the third year of a balanced budget without the assistance of the Buffalo Fiscal Stability Authority since the beginning of the control period, and
· These all follow two consecutive credit upgrades by the Wall Street rating agencies.

The assurances for continued prudent fiscal management practices include:
· Continued wise and conservative budgeting, as exemplified by this budget, which limits General Fund growth to 1.42 %, well below the 2.2% rate of inflation projected by the New York State Division of the Budget for the upcoming year;
· The institution of a “culture of accountability and efficiency” in City Hall, with CitiStat Buffalo having fundamentally changed the way this City does business;
· Modest assumptions of annual State aid increases
· Dedication of significant portions of our State aid increases to settling our labor contracts and for targeted economic development projects;
· Inclusion of recommendations for what the Buffalo News termed “a sweeping” fiscal reform package, that for the first time would implement a City fund balance policy to create “rainy day” reserves as recommended by GFOA, codify the four-year planning requirements of the BFSA act, and increasing our tax margin;
· Creation of an internal Task Force to lower costs due to Worker’s Compensation, Injured on Duty (IOD), overtime costs, and health care.

While the legal opinions of the Control Board and State counsel on the BFSA Act prevent this Board from authorizing the Step and Longevity payments our workers have accrued during the period of the wage freeze, I will continue to work on ways to recognize these losses and successfully negotiate contracts that reflect our workers’ contributions.