Diana Palmer: What Glens Falls must do to get its finances in order

By Diana Palmer, Glens Falls Ward 3 Councilwoman

Glens Falls’ Financial Future — A Chance to Get Real About Our Budget.

Mayor Collins recently pointed to the $7.88 million fund balance as proof that Glens Falls is financially strong.

While the numbers may look healthy at first glance, the reality is more complex. The proposed budget this year projects a $1.6 million deficit, and in previous years, we faced similar shortfalls.

We’ve managed to grow our fund balance largely because of temporary factors like the one-time infusion of $12 million in American Rescue Plan Act (ARPA) funds, a few mild winters, stronger-than-expected sales tax revenue, and the fact that we’ve been budgeting for full staffing levels while being consistently less than fully staffed.

ARPA Gave Us a False Sense of Security.

With a budget of around $24 million, having an additional $12 million from ARPA over the last couple of years has been significant. ARPA covered many expenses — vehicle purchases, building repairs, technology, and more — that otherwise would have come from our fund balance or increased our debt.

Now that ARPA funds are gone, we must confront the structural issues in our budget. Without careful financial planning, the city risks depleting its fund balance in the next few years as debt grows and deficit spending continues.

Hard Choices Once Saved Us—Are We Forgetting?

One of my first experiences after being elected in 2017 was witnessing the New York State Comptroller present Glens Falls with an award for getting out of fiscal distress.

Under Mayor Jack Diamond’s leadership, tough cuts were made, staffing was reduced, and shared services were explored, including moving dispatch from the city to the county. These decisions put the city’s financial health first.

A significant decision was turning over the Civic Center to the Civic Center Coalition, creating what we now know as the Cool Insuring Arena. This move helped reduce the city’s financial burden, allowing us to focus on our core services and begin rebuilding our fiscal strength.

But in recent years, we’ve started to grow city staffing levels and expand government operations once again. While I’ve tried to slow this growth, I’ve been unable to support the budgets over the last two years for these reasons. We’re repeating the same mistakes of the past, forgetting the hard lessons that helped us regain stability.

As the saying goes, ‘Hard times create strong men, strong men create easy times, easy times create weak men, and weak men create hard times.’

We are living through easier times now — thanks to the tough decisions made in the past and the temporary cushion provided by ARPA funds. But if we continue making risky choices — like expanding government and taking on more debt — we are heading for hard times again.

Stay in Our Lane.

We have an opportunity right now to learn from our past and plan wisely for the future. City government’s core responsibility is to provide essential services like public safety and public works.

We don’t need to overextend into industries like hospitality or real estate, as we are doing with projects like 36 Elm or the Market Square building.

Recently, the mayor proposed spending $40,000 to take over event coordination from volunteers like the Glens Falls Collaborative. This move risks taking control from our active business community volunteers and putting it in the hands of city government, funded by taxpayers.

Fortunately, when I raised this concern at our budget meeting, the rest of the council agreed, and we denied the spending request. This is just one example of why we need to stay focused on core responsibilities and avoid unnecessary overreach.

Growing Debt and Rising Costs

Meanwhile, our long-term debt is already at $109.45 million, and next year we’ll be adding another $3.6 million for the Downtown Revitalization Initiative (DRI). Our debt obligations include bonds, installment purchase debt, and growing liabilities for pensions and post-employment benefits.

At the same time, public safety costs are increasing due to necessary salary raises for police officers from recent contract negotiations. And with 27% of our assessed property value being tax-exempt, the burden on taxpayers to cover these rising costs is only getting heavier.

The Way We Conduct These Conversations Matters.

During recent budget meetings, I encountered significant resistance when raising these concerns. When I tried to discuss the city’s financial future and ask important questions, the mayor became visibly upset and even called my questions ‘disturbing.’

These meetings should be an opportunity for open, transparent conversations about the future of our city. However, the atmosphere often feels adversarial, making it difficult to ask the tough questions necessary for sound financial planning.

We need to foster a culture of productive, respectful dialogue, especially when it comes to matters as important as the budget. Open conversations are key to making informed, responsible decisions that will benefit our city in the long term.

Unrealistic Comparisons Don’t Help.

At one point during the budget process, we were shown a spreadsheet comparing staffing levels between Glens Falls and Kingston, New York. The point was to show that we have fewer staff and lack certain departments that we should consider growing.

It’s concerning that we would even be shown this comparison because it completely misses the mark.

Kingston’s larger population and budget make it an unrealistic comparison for Glens Falls, and using it to justify growing our staffing levels isn’t appropriate Kingston has about 10,000 more people than we do and a budget of $52 million, while ours is only $24–$25 million.

An Inflection Point—Warning Signs Resurfacing

Many of the warning signs the Comptroller flagged back in 2014 are resurfacing. We’re expanding into areas that stray from core municipal responsibilities, just like we did with the Civic Center years ago. We’re also seeing growth in debt and expenditures, a high number of tax-exempt properties, and budget decisions based on temporary revenue boosts rather than sustainable planning.

While we’re not in a crisis yet, this is an inflection point. The temporary cushion provided by ARPA is not an invitation to spend more or expand government. It’s a chance to stabilize our finances and plan for a sustainable future.

What We Need to Do Next.

It’s time to make smart, strategic decisions that ensure Glens Falls remains financially stable. Here are a few steps we can take:

1. Consolidate Departments: Streamlining operations can help save money without sacrificing essential services. We need to focus on hiring people with the right skills for the roles we actually need.

2. Consider Self-Insurance for Healthcare: We should explore self-insurance, as Warren County and SUNY Adirondack have successfully done, as a potential way to control rising healthcare costs.

3. Explore Voluntary PILOT Programs: Our largest tax-exempt institutions may be willing to contribute to the cost of city services they depend on. Cities like Albany and Boston have done this, and it’s time for Glens Falls to start these conversations.

4. Target Grant Spending: Let’s focus on grants that align with our long-term strategic goals, rather than pursuing every available opportunity.

5. Use the Fund Balance Wisely: Instead of expanding government, the Council has discussed using excess fund balance to pay down long-term debt or earmark it for future known expenses.

This approach, debated during our budget meetings, contrasts with the Mayor’s proposal to allocate funds toward new positions or expanding city government into areas like event promotion —responsibilities that are better left to the private sector. Focusing on debt reduction and long-term planning ensures that we’re prepared for future financial challenges, rather than relying on temporary surpluses.

Conclusion: Don’t Squander This Opportunity.

The fund balance doesn’t tell the whole story. We can’t count on it to carry us through the coming years. If we use this moment wisely, we can set ourselves up for a stable future. But that requires focusing on what we do best: running the city efficiently, providing essential services, and avoiding overreach into areas that don’t serve our long-term goals.

We are at a turning point. As we make strategic decisions on where to invest more taxpayer money, we need to focus on getting the most return on those dollars. That means prioritizing intelligent economic development and essential services — areas that will have the greatest impact on our community’s long-term success.

It’s time for us to stop relying on temporary fixes and start planning for a future that is built on realistic financial principles. Let’s make sure we don’t squander this opportunity.

A Disclaimer About Ongoing Budget Process. As the budget process is still ongoing, some of these figures are subject to change. However, the core issues remain the same, and these numbers provide a clear snapshot of the challenges

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