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Olean finance committee weighs personnel reallocations and sales-tax formula that could force deep cuts
Summary
Committee discussed reallocating personnel costs across general, water and sewer funds and debated using a 12-month rolling sales-tax figure at 90%, a change that members said could require roughly $500,000 in additional cuts and put jobs at risk.
The Olean Finance Committee continued review of the city’s proposed fiscal 2025–26 budget on March 20, focusing on personnel-cost reallocations and how the city calculates projected sales-tax revenue.
Committee members and staff described a plan to reallocate portions of several employee salaries from the general fund to the water and sewer funds. Staff explained those shifts reduce the general-fund personnel line but do not lower total city payroll; rather, they spread costs to funds that more directly benefit from the positions’ work.
The discussion turned to how the city projects sales tax revenue. Staff presented a $5.3 million sales-tax projection for the budget year, down from an earlier $6 million assumption. The committee revisited a policy proposal to set the annual sales-tax projection at 90% of the most recent 12 months of actual receipts. Members noted that applying 90% to the $5.3 million figure would lower the budgeted sales-tax amount to roughly $4.8 million — a reduction of about 9.12% from the $5.3 million estimate — and would require roughly an additional $500,000 in cuts to balance the budget.
Committee members said the scale of further cuts could affect staffing levels. One member observed that if the 90% approach were applied to the current projection, it could translate into eliminating “10 to 12 jobs,” though no specific personnel actions were proposed or voted on at the meeting.
Members debated how to define the 12-month lookback. Some said the policy should use the most recent full 12 months (for example, the prior calendar year) so staff can build a budget; others said the resolution’s original language referencing “most recent 12 months” lacked a fixed cutoff and should be clarified. The committee agreed to send the question back to committee for additional review and to bring the issue back to the council.
No formal changes to the sales-tax policy or to personnel allocations were adopted at the meeting. The budget presentation and staff recommendations will return to committee for further consideration ahead of final council action.
