Keaton PetersMunicipalities across New York are asking the governor for predictable funding increases to address local fiscal challenges. In a letter sent to state leadership on March 7, nearly 400 mayors and local officials organized under the New York State Conference of Mayors and Municipal Officials (NYCOM) praised the first increase in unrestricted municipal aid in 15 years while urging state leaders to commit to consistent annual increases in Aid and Incentives for Municipalities (AIM) funding.
In the letter, hundreds of mayors from across the state acknowledge the $50 million boost in funding included in the 2024-25 State Budget, writing that the increase is “a welcome and much-needed step toward addressing the fiscal challenges our local governments face.” However, the municipal leaders emphasize that this one-time increase isn’t enough to address long-term financial pressures.
After a decade and a half of stagnant state support, New York’s cities and villages find themselves at a critical juncture. With local governments facing mounting fiscal pressures from inflation, depleted federal COVID relief funds and flattening sales tax revenue, municipal leaders are seeking a more reliable partnership with the state to provide funding for maintaining services.
“Unfortunately, local governments continue to grapple with the impacts of inflation, the end of federal ARPA funds, the flattening of sales tax revenue – and now the threat of losing federal aid,” the letter states. “These factors, coupled with 15 years of level funding and a 2% tax cap, have placed significant financial strain on many municipalities.”
The mayors specifically pointed to their shared priorities with state leadership, particularly around property tax affordability and public safety. “Our cities and villages are on the frontlines of ensuring property tax affordability and public safety, so like yours, these are our priorities too,” the letter reads. “However, our ability to address these critical issues is directly tied to the level of support we receive from the state.”
The push for increased municipal aid comes as local governments across New York face tough decisions about cutting services, depleting reserves or raising taxes. Many communities have deferred infrastructure maintenance and capital projects due to budget constraints, creating potentially larger costs down the road.
A recently released report from State Comptroller Tom DiNapoli highlights increased budget challenges for local governments. DiNapoli’s analysis found that despite last year’s increase, when adjusted for inflation, AIM funding has declined nearly 30% over time and is now worth less to local governments than what they received in fiscal year 2004-05, the year before the AIM program started.
Whether Gov. Kathy Hochul and legislative leaders will heed the mayors’ call for consistent, predictable funding increases remains to be seen, as budget negotiations on Hochul’s $233 billion proposal are ongoing. The current state budget is due April 1.
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