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Credit rating lowered to junk

By DANIELLE T. FURFARO, Staff writer
First published: Wednesday, November 13, 2002

Despite the City Council's effort to begin to repay its capital fund and a 25 percent property tax hike for 2003, Moody's Investors Services on Monday downgraded the city's bond rating to junk status.

The move from a Baa3 rating to Ba1 means that the city will most likely be forced to pay exorbitant interest rates if it wants to borrow money in the future and will have to cut back on its long-term projects such as road repair and building construction.

"This is going to have an adverse impact on our ability to do capital projects if we have to pay additional debt service," said council member Mark Blanchfield.

...

Two weeks ago, the council was set to pass a budget that included an 8.4 percent tax increase until an audit by the state comptroller's office last week revealed that the city had spent $5.1 million from its capital fund, which is reserved for building projects, to cover operating expenses and to pay lawsuit settlements. The comptroller's office also revealed that Jurczynski had known about the audit since August, but failed to tell the council, even as they were on the verge of passing a budget.

At the council meeting Monday night, several members of the community told lawmakers that they are enraged by the council's decision to hike taxes 25 percent.

City resident Pat Salinger went through a list of her monthly expenses and explained that the tax hike would leave her with barely enough money to live.

"Consolidate with the county or declare bankruptcy," she demanded of city officials.

Many residents also called for the resignation of Jurczynski, and council member Edward Kosiur revealed that some members of the council have asked the state attorney general's office to review the audit and make sure no other improprieties took place.

"We still don't know where the Enterprise Zone money is," said Kosiur, referring to more than $600,000 that was supposed to be held for the program. "We have to make sure that everybody is coming clean. Just how much money are we missing?"

Submitted by: Werner Hetzner 

Source: Albany Times Union

 

 

 

 

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