Watertown's Finances In Good Shape, Comptroller Says
The city of Watertown of Watertown appears to be in good financial health.
That's according to a fiscal profile of the city released by state Comptroller Thomas DiNapoli Wednesday at the comptroller’s 2013 Local Government Leadership Institute in Watertown.
DiNapoli commended the mayor and city council for working within a realistic budget at a time when that's not so easy to do.
"They have been very responsible in how they've managed their budgets. They've been very smart in building up fund balance, and using it as a way to navigate through a tough time," said DiNapoli.
The report notes the city has maintained a stable tax base, developed healthy revenue streams, and built up rainy-day reserves.
But the city isn't in the clear yet.
The mayor says there are still challenges to overcome.
"You've got a continued problem with tax-exempt property - a lot of it. And you've got continued high levels of contribution of the pension program and obviously healthcare and insurance costs there," said Mayor Jeff Graham.
"Watertown has accurately and realistically budgeted, putting it in a strong fiscal position," DiNapoli said.
"The proximity to Fort Drum and the Canadian border provides Watertown a notable economic advantage, but wise budgeting decisions have been integral for the city’s continued fiscal health," he said in a release.
DiNapoli complimented city officials "for implementing a multi-year financial plan that has kept the city’s finances on track."
"Over the past decade, the city of Watertown has worked hard to keep its finances on solid ground while properly planning for the future," Graham said.
"DiNapoli's report provides affirmation that our efforts have paid off," Graham said.
According to the report, the city’s revenue grew an average of 4 percent annually from 2001 through 2011, compared to 3.4 percent for all New York cities during the same period.
Meanwhile, the city’s expenditures increased an average of 3.4 percent annually during the decade, the same rate as for cities overall.
The report shows the higher rate of revenue growth and slower rate of spending have allowed Watertown to reduce its debt service costs from nearly 20 percent of expenditures in 2001 to 7 percent in 2011.
According to the city’s most recent annual financial report, the general fund had a balance of $8.9 million -- or 16 percent of expenditures -- at the close of 2012.
Watertown has also benefited from markedly higher growth in property values than other cities, the report says. From 2005 through 2010, the city’s property values increased 74 percent compared to 30 percent for other upstate New York cities.
As of 2012, the city’s median home value was $116,700 compared to $99,700 for the statewide median.
Moody’s Investor Services recently upgraded the city’s bond rating to Aa3, specifically citing the city’s strong reserves, manageable debt level and increasing role as a regional economic center.
The report wasn't all good news. It highlighted several demographic challenges facing the city.
For example, Watertown’s median household income of $37,514 is significantly lower than the statewide median of $56,951. More than 18 percent of families in the city are living in poverty compared to 15 percent for all cities.
In addition, the unemployment rate of 9.2 percent is higher than the statewide rate of 8.5 percent.
The report also noted:
- Watertown has exhausted 6 percent of its constitutional tax limit, leaving the city an available tax margin of $18.5 million.
- The city’s population has declined 21 percent from 1950 through 2010.
- Sales and use taxes accounted for 30.4 percent of city revenues, compared to 20.5 percent for cities statewide.
- Real property taxes accounted for 13.1 percent of revenues, compared to 25.6 percent for cities statewide.
- Fort Drum, located just miles from the city and home to 19,000 soldiers, provided a $1.4 billion economic impact on the Watertown region in 2011-12.
Wednesday, July 30, 2014, Watertown, NY
On Wall Street