Due to an unstable local and national economy, the Town of Colonie's $5.6 million deficit-reduction tax in 2008 barely put a dent in the deficit, according to an auditor's report to the Town Board on Thursday, Oct. 7.
It was in a year of very unfortunate circumstances, said William Freitag of Bollam, Sheedy and Torani, the accounting firm that performed the audit on the town.
Freitag said the town was not able to predict the downturn of the economy, and officials expected the deficit reduction plan to have a much larger impact.
He said the revenue from the one-time tax was intended to go directly to the bottom line, but a tumbling economy meant a decline in other revenue sources. He said the town's sales tax revenue is down $1.7 million and departmental income went down $3 million.
The town built up a deficit over the past six or seven years that amounted to $27,370,000 by Dec. 31, 2008. Officials were able to take a $2,770,000 chunk out of that number in 2008, but they were only able to reduce it by $750,000 in 2009.
"Unfortunately, you had the situation where you were trying to put a nice little dent in the deficit and you were impacted by sources out of your control," said Freitag. "It's one of those perfect storm type of things."
While the $5.6 million did lessen the impact of the recession, Town Supervisor Paula Mahan said the town did what it could to "stay afloat."
"With the weak economy, and under the circumstances, we kept the town from going under and that's basically where the town was at that point," she said. "You can't control the economy but on the same token, the town is still moving forward, and that's the positive side of it."
Also found through the audit, George Person, a municipal specialist with Bollam, Sheedy and Torani, said Colonie is in a unique situation because it includes villages within the town.