www.ny.gov - DISTRESSED MUNICIPALITIES TO RECEIVE ADDITIONAL AID

New York State Executive Chamber | Governor Eliot Spitzer

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FOR IMMEDIATE RELEASE:
January 31, 2007

DISTRESSED MUNICIPALITIES TO RECEIVE ADDITIONAL AID

Governor Eliot Spitzer today proposed a major expansion of aid to distressed cities, towns and villages across the state.

“A resurgence of the Empire State cannot occur without a resurgence of our cities, particularly those in the Upstate region,” Spitzer said. “Investment and jobs will flow only to those areas that are safe and vibrant places to live and work.”

The Executive Budget Proposal includes a $200 million four-year commitment to expand the Aid and Incentives to Municipalities (AIM) program, which was announced earlier this month as part of the Governor’s “Renew New York” plan to revive the Upstate region. In 2007-08, $50 million in additional annual performance-based aid will be provided to distressed cities, towns and villages. With this investment, the program will total nearly $697 million.

Under the proposal, increases in aid would be tied to greater accountability. Municipalities receiving the largest AIM increases would be required to develop multi-year fiscal performance plans and to use the additional funding to provide property tax relief, support essential economic development investments or fund cost-saving technology investments.

The budget commits to $50 million increases in each of the four years of the financial plan. This will allow for AIM increases ranging from 3 percent to 9 percent, based on level of fiscal distress.

Cities that will get the highest increases over the next four years include Buffalo receiving an additional $12.8 million in 2007-08 and an increase of $57 million over four years, Rochester receiving an additional $9.7 million in 2007-08 and a total increase of $31 million, Syracuse receiving $5.7 million more in 2007-08 and a total increase of $25 million, and Yonkers receiving $5.1 million more in 2007-08 and a total increase of $22 million.

The Governor's AIM proposal also recognizes the needs of fiscally distressed towns and villages, making these municipalities eligible for the higher AIM increases using the same distress criteria as cities.

Consistent with the targeted nature of the program new emphasis on assisting distressed municipalities, New York City and 81 high wealth towns and villages that had previously received this funding will no longer receive it. These municipalities rely on AIM for less than one percent of their local revenues.

A list of aid to all municipalities is available at: www.budget.state.ny.us.

The increased AIM commitment is part of the Renew New York Agenda advanced in the Governor’s Executive Budget which also includes a $300 million Investment and Job Creation Program and an eleven-year, $2.1 billion Stem Cell and Innovation Fund program.

In addition to the AIM expansion and restructuring, the budget proposal includes a number of other measures designed to benefit cities, including: increased education aid; property tax relief; consolidation incentives and mandate relief, including Wicks Law reform.