A recent report from New York State Comptroller Thomas P. DiNapoli shows that 23 local governments in the state have been designated as fiscally stressed for their fiscal years ending in 2024. This is an increase from 14 municipalities identified last year, with more governments falling into each category of stress.
“The number of local governments designated in fiscal stress, while still low, rose over the prior year, as federal pandemic relief funding was winding down,” DiNapoli said. “Local governments now facing volatility in revenue sources and uncertainty from significant shifts in federal spending should remain vigilant and pragmatic when spending and planning for the future.”
The Fiscal Stress Monitoring System (FSMS), established by DiNapoli in 2013, evaluates local government finances using factors such as fund balance at year-end, operating deficits, cash-on-hand, short-term borrowing, and fixed costs. The system is intended to provide early warnings to officials about potential fiscal issues and to inform the public about their community’s financial health.
Fiscal stress scores are released twice a year for municipalities other than New York City. The latest scores apply to all counties and towns, 44 cities, and 13 villages that operate on a calendar-year basis. Of those designated this round, four cities, nine towns, and one village were found to be under fiscal stress. Earlier this year, nine villages with non-calendar fiscal years were also named as stressed. School district scores are scheduled for release in January.
In the highest category of “significant stress” for FYE 2024 were the City of Little Falls (Herkimer County) and the villages of Cambridge (Washington), Island Park (Nassau), and Saugerties (Ulster). Cities including Albany (Albany) and Poughkeepsie (Dutchess) were categorized under “moderate fiscal stress,” along with Massena (St. Lawrence) and Yates (Orleans) towns, plus Coxsackie (Greene), South Blooming Grove (Orange), and Washingtonville (Orange) villages.
Municipalities listed as “susceptible to fiscal stress” included Elmira city (Chemung); Bennington town (Wyoming); Canton town (St. Lawrence); Centerville town (Allegany); Kent town (Putnam); Louisville town (St. Lawrence); Schroeppel town (Oswego); West Turin town (Lewis); Chateaugay village (Franklin); Huntington Bay village (Suffolk); Kaser village (Rockland); and Liberty village (Sullivan).
DiNapoli’s office also reported that fewer municipalities failed to submit required annual financial reports on time: 240 did not file in FYE 2024 compared to 264 the previous year. However, this figure remains nearly double what it was ten years ago. To address this issue, additional outreach and training have been provided to help local governments comply with reporting requirements.
Failing to file timely financial reports can signal poor financial management within a municipality. It can hinder officials’ ability to respond effectively to fiscal problems and reduce transparency with residents.
Three municipalities newly designated as fiscally stressed had missed several years of reporting before receiving scores this cycle: Island Park village had not received a score from FYE 2020-2023 but was now listed under significant stress; Massena town and Washingtonville village both received moderate stress designations after missing filings between 2018-2023.
Further details on these designations are available through lists of affected municipalities, detailed spreadsheets with scores statewide, summary reports on FSMS results for municipal fiscal years ending in 2024, as well as online interactive data visualizations.
