Buffalo, N.Y. (WBEN) - During last Thursday's session in Legislature Chambers in Downtown Buffalo, a plan to borrow up to $44 million for some major construction projects in Erie County was turned down in a vote amongst Erie County Legislators.
This bonding resolution that was voted upon by Legislators needed, at least, eight votes in order for it to pass, but the four Republicans as part of the Minority caucus voted down the resolution.
The $44 million also leverages another $11 million and change in state or federal aid. These projects total around $55.627 million, with around $44.479 million of that in bonds being taken out by the County. However, the $11.147 million in state or federal aid is not given to the County unless it spends the money that's being bonded.
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Legislator Christopher Greene (R) says the No. 1 reason it was turned down was because they did not have all the information they had previously requested with regards to past bonding resolutions.
"We requested from the administration six years of updates on past bonding resolutions to find out what the status was for each project of those previous six years. When this went to committee, we were given three years of information, and we were literally handed it a couple minutes before we were set to discuss it," said Greene. "We could not prepare any intelligent discussions, so it should have just gone into committee. But this started getting very political, and the Democrats decided they wanted to push it through without giving us information."
When the Republican caucus had a week to evaluate and look through the information, Greene said they tallied $63 million worth of projects the Legislature borrowed money for that have not even begun.
"The big piece of this, by the way, is that none of these projects, none of these infrastructure projects; the first question I asked on the floor of the Legislature to [Erie County Comptroller] Kevin Hardwick was whether or not these projects needed to be bonded to begin, and the answer was, 'Of course not.' These projects can all be done with the current cash that we have on-hand, and many of them are not even, I don't believe, shovel ready," Greene said. "We would, again, be borrowing more money, we've paid a couple million dollars in interest for projects over the last few years that haven't started. So we don't have enough information, we can't pass the bonding resolution."
As for Hardwick, the County Comptroller is hopeful this decision is revisited at the next Legislative session on April 13. The longer it takes to vote and approve the bonding resolution, the more projects that are being held up.
"A lot of these are road projects, we have a very short construction season in Erie County to begin with, and if we don't get this approved by April 13, that's not going to give us the ability to advance the money, the comptroller's office to advance the money to DPW [Department of Public Works], or whomever, to start these projects," said Hardwick. "I can see the point that the Republicans in the Legislature are trying to make, I don't necessarily agree with it, and I think there is a cost, and the cost is in time, and the amount of work that will be able to be done this summer."
While Greene understands Erie County is likely going to have to bond some of these projects out, he says the Republican caucus wants a better understanding of where each project is, and how close they are to being shovel ready. It is all in an effort to avoid borrowing anymore money and then having to pay interest fees, especially if a certain project might still not get off the ground for a couple years.
"We have a $117 million unrestricted fund balance, we don't know what the total amount of surplus from last year's budget is going to be, but I'm expecting it to be North of $40 million. So all of these projects, we might be able to just begin with the cash that was leftover [from the] budget from 2022," Greene said. "But realistically, we're probably going to find a mix between cash upfront, and, again, I don't want to bond out money and pay interest on something that we can't begin the project."
Hardwick says the sorts of items the County is looking to bond and may borrow money for are improvements to roadways that will last a few years, as well as projects for Erie Community College and the roof of the Buffalo and Erie County Public Library.
However, he does point out a line where the County may be tempted to pay a certain amount of cash that would otherwise be borrowed money.
"In the end, that's a personal decision, and I think the Legislature and the [County] Executive [Mark Poloncarz] have the decision here of whether they want to borrow for these things, or whether they want to pay cash."
There would be an advantage for being willing to utilize the money the County has on-hand, and that would allow for certain projects and other matters to get going right away. The disadvantage, though, is the County would be spending money that might be needed for something else more pertinent down the road.
"There are a lot of storm clouds on the horizon, we don't know where this economy is going. The stock market has been in the dumpster for a while. People worry about that looming recession, which is yet to really take hold, but if it does, we don't want to be in a situation that the county found itself in 15-20 years ago when it, pretty much, exhausted its reserves. Its fund balance was really close to zero, and it has no rainy day account anymore," Hardwick said. "We want to worry about what's in the future and what we might have to use that money for down the road."
Even though inflation has been getting a little bit out of control lately, Greene believes the money the County has in the bank right now, even if they're investing it, they are not going to make money on their money as quick as inflation is going up. He says that will make the value of their $117 million worth less in the future than it is right now, which makes sense as to why that money should be spent.
One other issue Greene points out that he finds to be out of line is all of the consolidated bond resolution bills that he's seen on the Legislature floor in his tenure in county government have all been done in May.
"This one is being done in March, or is trying to be pushed through in March, without all of the information we requested, and with a history of borrowing on projects that are not shovel ready. That is the big problem," he said. "All of us want the same end goal, and that is all the infrastructure projects to get off the ground, because we have a limited season in Western New York. With snow, we have to get it done during the spring and summer times. We all want these projects moving and moving forward. A lot of them need to get done, some of them are not as urgent as others, but we need to have a comprehensive plan. We need to change the way Erie County is doing business and stop borrowing on projects that are not going to get off the ground."
One example Greene uses to prove his point is $2.5 million the County borrowed three years ago for improvements to their own salt burns in the region.
"We don't have to work with other municipalities, this is our own property we own. Over the last three years, not $1 has been spent to improve those salt barns, and we've paid $187,000 in interest. That did not need to be bonded out three years ago," Greene said. "We need to figure out what projects, and have a much more comprehensive committee discussion before we select which ones are going to require bonding of this year, and which ones we can move forward with cash."
As for a possible timing of a resolution with this matter, Hardwick believes it will be resolved in some form at the next Legislative session on April 13.
"If they have to strike some sort of compromise, so be it. That's up to the Legislature and the Executive. But again, the longer we wait, the less work we can do this year on county roads," Hardwick said. "People complain about the roads, well, there's a plan to fix the roads, but until this bond resolution gets passed or there is some other resolution, the work can't get done."
Meanwhile, Greene expects everything to be done within the next month, but not before comprehensive discussions are had at a committee level to get a solid understanding of all of the projects from the past and all the projects in the future.
"We're still waiting on three years of project updates from the previous three years that we've already been provided. With that said, I expect things to move forward," he said. "The only one holding it up right now is the administration providing us that data. Once we get it, I'm very confident that these projects will move forward."
Greene adds if there's something that is time sensitive, members of the Republican caucus have said to put the matter front of them and they will make sure it gets passed, with cash, as soon as possible.
"The administration has the ability to put any project in front of us on a cash basis, which we have, and get it off the ground, especially if you're just looking at the design portion of the project, which is a small piece of a larger project," he said. "We can pay for the cash right now, and then we can bond out the rest of the project when we know what's going to happen with a timeframe and set. Nothing is being held up by the rejection of the consolidated bond resolution right now."
Despite the request from the Republican caucus for additional information before voting to approve the bonding resolution, Poloncarz issued a statement last Thursday pursuant to the Legislature’s action. He also followed the statement with a couple of tweets, saying the GOP members of the Legislature had no reason to vote against the borrowing resolution, and, "When the roads don't get fixed, blame the Republicans."
Greene felt there was no need for the County Executive to go to the extent he did with his statement after last Thursday's decision, and to throw blame at the Republican caucus of the Legislature.
"Anytime the County Executive wants to sit down with me, he's got my phone number, I will be more than happy to bring a couple beers over to his place and we can sit down, we can discuss this like adults," Greene said. "I don't need to go on a Twitter rampage and try to embarrass him. We are all trying to work for the betterment of Erie County, and I'm ready as soon as he is."