New Hartford takes advance from county to meet payroll

By ELIZABETH COOPER

Observer-Dispatch

Posted Jan 05, 2010 @ 02:18 PM

Last update Jan 05, 2010 @ 08:49 PM

NEW HARTFORD —

The town got a $300,000 advance from Oneida County to make its most recent payroll and cover other bills, new town Supervisor Patrick Tyksinski said Tuesday.

But, much like a resident living paycheck to paycheck, the town is already worried about its next round of commitments.

“The problem is, we’ve got another payroll coming up Thursday,” he said.

It’s all part of the dire situation Tyksinski is walking into as he takes the reins of the fiscally distressed town.

During the four-year tenure of Tyksinski’s predecessor, Earle Reed, the town burned through much of its reserves.

“We are basically left with nothing,” Tyksinski said of the town’s accounts. “And from a cash flow standpoint, we are now $300,000 in the hole to start with because of this advance.”

The advance from the county, which was received late last month before Tyksinski was sworn in, came from anticipated sales tax revenue for the final quarter of 2009, funds that are usually not disbursed until February.

This week’s payroll amounts to about $230,000 for the two-week pay period that ended Saturday. Tyksinski said when he took office Jan. 1, there wasn’t enough money in the town’s reserves to cover that.

One way or another, the town will pay its employees, he said. Some other payments that were set to go out will be delayed, and money from early property tax payments also could be used, he said.

Not notified

Town Board members reached Tuesday said they were upset about the $300,000 advance because they had not been informed of it.

“Was it our only option or were there other options?” board member Christine Krupa said.

“It puts us in a bad position for 2010,” board member Rich Woodland said.

Board member Donald Backman, who was sworn in Jan. 1, said as long as the funds were only used for 2009 expenses, the advance seemed appropriate, although the board should have been notified.

Board member David Reynolds said he was not aware of the issue.

Heather Mowat was hired in June 2009 to address the town’s finances after revelations of the town’s plummeting rainy day fund.

She made numerous mid-year cuts, but said she still had to resort to tactics such as interfund borrowing and seeking the sales tax advance from the county, she said.

Reed authorized the advance, she said.

Reed, who served from 2006 until the end of 2009, could not be reached Tuesday.
Mowat is no longer employed by the town.

The advance

The total sales-tax revenue expected by New Hartford from last year’s final quarter could exceed $1.2 million, but now the town won’t have access to $300,000 of that.

Oneida County Executive Anthony Picente said the county makes such advances on rare occasions when a municipality is in extreme need.

“The town found itself in a very unique situation,” Picente said. “We are not a bank.”

He and Tyksinski disagreed Tuesday over whether the advance could be characterized as borrowing. Picente said the county is not allowed to make loans and was only advancing money that belonged to the town anyway.

Tyksinski, however, said in his view, the town had borrowed the money against its own expected revenue.

No interest is being charged and the town does not have to return the money to the county.