Dunkirk’s proposed budget “is not balanced,” according to the state comptroller’s office.

The state Comptroller’s Office has numerous criticisms of Dunkirk Mayor Kate Wdowiasz’s proposed 2025 budget.

Deputy Comptroller Robin Lois sent a letter to city officials this week outlining the criticisms. A big one was that the city still has not enacted proper accounting procedures.

“The lack of complete, accurate, and current accounting and financial records significantly limited our review and precluded us from determining the reasonableness of all of the city’s significant revenue and expenditure projections,” Lois wrote.

Lois continued that Dunkirk’s officials were advised their records were incomplete on multiple occasions, but still made “key financial decisions including developing this budget without adequate information.”

Despite the alleged lack of information, the state’s budget review found some inconsistencies. For example, according to Lois, the 2025 proposal “is not balanced” — it has $1,450,276 more estimated revenue in its general fund than estimated expenditures.

Lois went on to criticize planned deficits in the water, sewer and Dunkirk Boardwalk funds. She said the city made up previous deficits in those funds “by relying on the general fund tax levy and fund balance. This approach negatively affected the general fund’s financial condition to the point that the city has no remaining fund balance.”

The 10-page letter has more criticism. Lois stated Wdowiasz did not include the cost of two recently purchased fire department pumper trucks in the budget “and has no other funding plan for them.” The mayor reportedly stated that the city is looking to sell one of the trucks and obtain outside funding for the other.

“Given that neither of these scenarios may come to fruition, city officials must consider how they are going to fund the pumper trucks and how that will impact the 2025 budget,” Lois wrote.

In addition, she added, the city might not be able to issue deficit bonds in time to pay interest on a Revenue Anticipation Note in July, due to the poor state of its financial records.

Lois also bashed the proposed budget on its retirement, health insurance and workers compensation sections, stating that they also did not balance.

At one point, noting a $13,316 underestimation in workers compensation payments, Lois wrote, “Although immaterial in amount, these variances demonstrate city officials’ lack of accounting knowledge and their inability to maintain accurate accounting records or budget appropriately.”

The letter concludes that city officials need to review proposed estimates for revenues and expenditures and “amend as necessary.” The city’s Common Council must make updating and correcting financial records “a priority.” The council also must ensure that it passes balanced budgets, Lois added.

As Lois’ letter notes, the Comptroller’s Office made its recommendations as part of the Fiscal Recovery Act which pumped millions into city coffers. The act authorized the city “to issue debt not to exceed $18.5 million to liquidate the accumulated (actual) deficits” in its general, water, sewer and capital project funds. As part of that deal, the Comptroller’s Office started a close watch of Dunkirk’s finances.

In addition, the office said, the city’s outstanding liabilities totaled more than $20.5 million. These liabilities exceed the $18.5 million maximum amount authorized by the State Legislature pursuant to the Act.

The Common Council is supposed to pass a final 2025 budget by Dec. 15. According to the letter, the council “must review all recommendations made by the state Comptroller and must make adjustments to its budget consistent with the recommendations contained in this report.”

The Comptroller’s Office letter to Dunkirk is posted on the state agency’s website.

The link is www.osc.ny.gov/local-government/audits/city/2024/11/27/city-dunkirk-budget-review-b24-1-10