State Gov. Kathy Hochul in Dunkirk in 2023.

Sounding an overly sympathetic and forgiving tone Friday, Gov. Kathy Hochul signed legislation that authorizes a $13.6 million emergency loan from the state of New York to the city of Dunkirk.

“Having spent years in local government, I understand the challenges our local leaders are experiencing, and this financial support to the city of Dunkirk is necessary to avoid a potentially devastating default that could ripple far beyond Dunkirk’s borders,” she said. “This legislation reflects the state’s commitment to stabilizing local governments in crisis while protecting the broader financial integrity of New York municipalities.”

In the news release, Hochul’s office said Dunkirk is facing a severe fiscal crisis driven by years of structural deficits and compounded by a looming deadline to repay a major revenue anticipation note. This legislation, the release said, safeguards Dunkirk residents from alternative measures, such as the creation of a financial control board.

Those sentiments from Hochul, however, are far from completely accurate.

Dunkirk’s money mess was years in the making due to a lack of attention to detail by those in power locally. Financial information was sloppy and not being compiled in a timely manner. Audits were not being completed yearly while previous Mayor Wilfred Rosas and past and present Common Council members approved budgets from 2020 to 2024 that were flawed and unrealistic in both revenues and spending.

Additionally, council members in 2021 carelessly and arrogantly approved $300,000 from the $11 million in American Rescue Plan Act funding for bonuses for workers and themselves. In the meantime, two other firetrucks that were to be purchased with ARPA funding were never put in city budgets.

These missteps added up to a $16 million deficit being announced by the municipality in March 2024.

Much of the turmoil stems from city leaders not accounting for a loss of $4 million annually in revenue from the former NRG Energy Inc. station that ceased operations in 2016.

In December, the Common Council approved an 84% increase in city property taxes after being presented with a budget plan that hiked taxes 107%..

Legislation S.8413/A.8870 enacts “The City of Dunkirk Revenue Anticipation Note Refinancing Act,” which allows the city to use state funds to repay its $12.7 million revenue anticipation note due July 24, 2025, which it would otherwise be unable to pay in full. The loan carries a 15-year amortization period at a 7.5 percent interest rate and must be repaid using city revenues, including through offsets to state aid.

It also requires the city to demonstrate that it has made good faith efforts to raise the necessary funds independently and includes provisions for state oversight of future fiscal practices while the loan is outstanding. The Act supports the city’s efforts to secure their long-term fiscal future and, according to the governor’s office, demonstrates Hochul’s commitment to the fiscal health of all state municipalities.

“This support is a vital step forward in helping Dunkirk stabilize its finances, continue delivering essential services, and begin the long-overdue process of rebuilding our financial foundation,” Mayor Kate Wdowiasz said. “The governor’s action today reaffirms her commitment to communities like ours and allows us to correct decades of mismanagement and move toward a more sustainable future.”

State Sen. George Borrello, R-Sunset Bay, was less appreciative of the action. “It’s a bad deal that trades essential state aid for more debt, with no oversight or accountability to fix the real problems that got us here in the first place. This is exactly the kind of short-sighted thinking that’s driven Dunkirk deeper into a fiscal crisis over the years.

“Worse, it bypassed standard legislative protocol by moving forward without a home rule message. Local leaders and residents on both sides of the aisle opposed this measure. They rightly recognized it as a short-term patch with long-term consequences.”

Borrello, R-Sunset Bay, and Assemblyman Andrew Molitor, R-Westfield, introduced legislation to create a financial control board. He called it a responsible, long-term solution that would bring structure, transparency, and real reform. “I continue to urge the governor and my colleagues in the Legislature to support our proposal to establish an independent financial control board for Dunkirk. That would deliver the accountability and support the city truly needs,” he said.

“Finally, if the governor truly wants to make a meaningful investment in Dunkirk’s future, I again call on her to stand up to the radicals in her party and restore energy production in Dunkirk, starting with natural gas power as a bridge to an eventual nuclear facility. That’s the kind of investment that would bring jobs, tax revenue, and lasting economic growth — not just another bill for local taxpayers to pick up.

“Dunkirk deserves real solutions, not political Band-Aids.”