Jamestown Mayor Eddie Sundquist is pictured Monday during a council Finance Committee meeting. P-J photo by Eric Tichy

Jamestown’s former comptroller believes the 2024 spending plan just recently passed leaves the city with a shortfall of at least $1.5 million.

Joe Bellitto, at the request of Mayor-Elect Kim Ecklund, has been reviewing the city’s general fund budgets for 2023 and 2024. He prepared a three-page letter on what he said was a “limited review” for both years that was discussed by the council Monday during a work session.

At issue appears to be a shortfall of $1.59 million in Consolidated Highway Improvement Program aid. The program, known as CHIPS, provides state funds to municipalities to support the construction and repair of highways, bridges, highway-railroad crossings, and other facilities that are not on the state highway system.

Bellitto, who was not present during Monday’s work session, noted in his memo, “My concern here for 2024 is similar to 2023. The amount for CHIPS revenue is $1,590,000; there is no specific amount for CHIPS expenditures included in the bound copy of the executive budget.”

Mayor Eddie Sundquist and members of the city’s budget team addressed Bellitto’s review in a two-page letter that also was discussed Monday.

To tackle the $1.59 million shortfall, the team recommends moving $500,000 earmarked for housing demolitions and $150,000 from a sidewalk repair program. Another $565,000 set for street maintenance can be moved to the CHIPS line as well.

“We also recommend increasing the tax levy by $250,000 to the original amount in the executive budget,” the budget team said in its two-page response given to council members. “Under the budget adopted by council, there was a reduced tax levy due to anticipated demolitions. Tax bills will be going out in January, before any demolitions for (fiscal year) 2024 tax bills to be affected, and there was no change in the adopted tax rate.”

Bellitto brought up other concerns in his review of the 2023 and 2024 budgets. They include:

– State aid per capita: He noted that there is an additional $500,000 in revenue “above and beyond the normal general-purpose aid the city receives from New York state” in the 2023 spending plan as well as $700,000 in revenue in 2024. He believes the amounts are anticipated revenue for getting city retirees to transfer from the city’s self-insured health program to an insured Medicare-Advantage program.

In its response, the budget team said the Financial Restructuring Board has been contacted and is “satisfied with the city moving forward with this reimbursement.” With more participants in the Medicare plan, the city also is expecting a higher reimbursement in 2024.

– Health and dental insurance: Bellitto believes the $2.5 million in anticipated contributions employees and retirees will pay toward their health and dental insurance premiums in 2023 and 2024 are overstated by about $450,000.

“As you know, health insurance costs tend to increase year after year,” Bellitto said. “Therefore, city employees and retirees are paying a percentage of an artificially low 2021 premium-equivalent and the city, and its taxpayers, are paying all of the increased costs since 2022. I suggest this be reviewed.”

The budget team, in response, feels the city’s health care expenditures are in line with the budgeted amount.

– New York state retirement: He noted a “major error” in that the 2024 budget was prepared using the 2023 pension payments the city will pay to the retirement system. He alluded to salary increases for city employees and “significant increases” in the retirement rates in 2024 over 2023 that were ignored.

Further, Bellitto believes the 2024 budgeted line items for retirement payments are underfunded by at least $600,000 for police and fire and $100,000 for other employees.

In response, the budget team said, “We believe retirement amounts are significantly overestimated … in his memo. Our retirement estimates are based on current payments and estimated salary increases in the 2024 budget.”

In November, the City Council approved the 2024 budget that holds the line on taxes. More than a dozen amendments to the $40.15 million budget were brought forward and then unanimously approved by the council.

According to Sundqust, and based on guidance from the New York Conference of Mayors, no budget amendments should occur until the start of 2024.