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What is an Austerity Budget.  
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Dr. Rev. Kevin M. Dougherty
Life22 Founder and Podcast Host. Father of 4 and Husband of 1.

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"Satire is not a fabric in reality, but it can exist as part of the fabric of reality." ~Kevin M. Dougherty~

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Day 13,889 - Austerity Budget 2026.mp3
Transcript
00:00:03 Kevin
Hey gang, Kevin here, Life22.
00:00:05 Kevin
Do you know what an austerity budget is?
00:00:08 Kevin
Probably not, right?
00:00:10 Kevin
Most people don't know what that is.
00:00:11 Kevin
Well, Olaya New York is a pretty unique town, city, in that we have in our charter no contingency plan if a budget doesn't get passed.
00:00:24 Kevin
And that is a way of, it's a way of checks and balances.
00:00:27 Kevin
It's not a bad thing to not have it.
00:00:29 Kevin
In this situation, it's a way to keep certain people on their toes and keep just keep power in balance, if you will.
00:00:38 Kevin
The austerity budget happens when you go beyond April 15th to pass a budget.
00:00:47 Kevin
The mayor presents the Common Council a budget on February 15th, and then they
00:00:54 Kevin
They deliberate over it and they've got roughly two months.
00:00:56 Kevin
By April 15th, they should have passed a budget, at which point you can send it up for public comment.
00:01:03 Kevin
There has to be a public hearing.
00:01:05 Kevin
There are many more council meetings involved as well.
00:01:08 Kevin
The budget's already, you know, then the budget gets passed and then it's published.
00:01:12 Kevin
And then before, before May 1st,
00:01:18 Kevin
The new budget is passed, at which point they start producing tax bills.
00:01:21 Kevin
The tax bills go out for May 1st.
00:01:25 Kevin
So you might get them around May 1st, you might get them slightly after, but you'll get your city tax bill around May 1st.
00:01:31 Kevin
Now, with that May 1st tax bill, all the different banks that are escrowing people's property taxes built into their mortgages will just kind of auto cut checks based on those numbers.
00:01:42 Kevin
So if they don't have those numbers, they don't cut checks.
00:01:45 Kevin
If you don't get your bill in, you're not going to pay
00:01:48 Kevin
your property taxes because you don't know what to pay.
00:01:50 Kevin
And so this is where it becomes a caveat.
00:01:53 Kevin
So the city's fiscal year starts June 1st.
00:01:56 Kevin
And what you need to know about that June 1st deadline is the city is expecting a large portion, like 50% of those taxes are usually arriving by that time.
00:02:06 Kevin
And then by the time you hit July 1st, you've usually got three quarters of it.
00:02:10 Kevin
Now it is only about 40% of the city's budget.
00:02:13 Kevin
The problem is
00:02:14 Kevin
that you're creating a budget based on all of your income sources and it spreads out throughout the year.
00:02:20 Kevin
So you might get a ton of it right at the beginning of the year.
00:02:24 Kevin
And if you spend it all at the beginning of the year, you don't have it to cover payroll and things like that, that are consistent costs throughout the year.
00:02:31 Kevin
So one of the big issues is that they're going to start with the austerity budget.
00:02:36 Kevin
They essentially start furloughing employees.
00:02:39 Kevin
Essentially, it's a government shutdown.
00:02:41 Kevin
And in my time here in the city, I've never seen this happen.
00:02:45 Kevin
Now, maybe I was under the age of 18 when it happened.
00:02:48 Kevin
I'm not sure.
00:02:49 Kevin
I actually have to do the research and find out the last time this happened, if it's ever happened at all.
00:02:54 Kevin
We've discussed it when I was on the council.
00:02:57 Kevin
It never came to fruition.
00:02:58 Kevin
Sometimes you get sticking points in the budget and you're like, you know what?
00:03:01 Kevin
Screw you.
00:03:02 Kevin
We're going to vote no on this budget.
00:03:04 Kevin
And it always ends up passing until now.
00:03:08 Kevin
Until now.
00:03:09 Kevin
And so now the Common Council has not passed a budget.
00:03:12 Kevin
They're discussing it tonight, probably exactly this time now that you're watching this video or the time that I'm actually recording this video, they are discussing it.
00:03:21 Kevin
Now, if they don't pass a budget, we run the risk of going into austerity, right?
00:03:29 Kevin
So into an austerity budget, which is an economic term that means strict or stringent, something like that, yeah, anyways.
00:03:38 Kevin
The austerity budget is what we would try to avoid, but it is a necessary tool to accomplish the end game, which is getting the budget where the council wants it.
00:03:50 Kevin
Sure, it's presented by the mayor, but it is the council's budget.
00:03:55 Kevin
So if the council wants changes, they can change it.
00:03:58 Kevin
The council can also pass the, excuse me, the council can also pass the budget and then deplete any line item that they would like.
00:04:06 Kevin
The American veto any action of the Common Council, and then the veto can be overruled by a majority of the council.
00:04:13 Kevin
So there's a lot of different things at play here.
00:04:15 Kevin
So if you're new to the game of local Olean politics and chess, you are going to have to kind of stay with me here because it's just a lot to throw at you.
00:04:27 Kevin
So
00:04:28 Kevin
The austerity budget means that only emergency services personnel, police, fire, some streets crews, some of the DPW staff, probably a good portion of water and the sewer division, those guys are going to end up having to work because we need running water, right?
00:04:46 Kevin
But
00:04:48 Kevin
And for a good portion of it, those specific funds, the water and sewer fund should remain unaffected by as they are different budgets.
00:04:58 Kevin
Now, their budgets for the year are going to allow them to be able to be authorized to cut payrolls and stuff like that.
00:05:08 Kevin
You would use that for your water and sewer increases.
00:05:12 Kevin
But if you don't increase, you still have the same consistent numbers coming in every month.
00:05:17 Kevin
You just would miss a deadline on having said increase.
00:05:22 Kevin
So you should still be able to cover it.
00:05:24 Kevin
It would be more or less the general fund line items.
00:05:27 Kevin
So you have your water, you have your sewer, and you have your general fund.
00:05:31 Kevin
Your water and sewer come out of those bills that everybody gets every month.
00:05:35 Kevin
But the general fund is where your property taxes, your sales tax, it would be
00:05:41 Kevin
you know, different other generating streams of income, ambulatory services that the fire department offers, tickets and fines, permits and fees, you know, different other different services that go out to the city and come back in.
00:06:00 Kevin
ice skating rink, you've got your skate rentals, you've got all these other things.
00:06:04 Kevin
Now, some of that stuff also goes to subsidize the, the payroll that goes into running a rink.
00:06:09 Kevin
But just, just to name a few examples, right?
00:06:12 Kevin
When you want to rent the pavilion at the park for your wedding or for a birthday party, whatever, that is also income generated by the city.
00:06:20 Kevin
It's about 40% of it is property taxes.
00:06:23 Kevin
And then about 30%
00:06:29 Kevin
40% of it is sales tax.
00:06:32 Kevin
25% to 30% of it is property taxes.
00:06:38 Kevin
I might have those two numbers screwed up.
00:06:41 Kevin
So don't quote me on it.
00:06:42 Kevin
But you get the rough gist, right?
00:06:44 Kevin
So like, either way, 30% to 40%, 25% to 30%, you're talking
00:06:52 Kevin
55% to 70% of the budget is those two items.
00:06:57 Kevin
So if your sales tax protections are down, then you're going to have, you know, you're going to have, you know, a budgetary influx.
00:07:05 Kevin
You might go into a spending freeze over that.
00:07:08 Kevin
If you have a
00:07:11 Kevin
If you don't increase taxes, or you don't get the taxes in, you're going to have those.
00:07:18 Kevin
If you have too much sales tax come in, you're going to have not a shortfall, but you are going to have an excess influx, which will roll to the general fund at the end of the year with all unspent funds that have come in.
00:07:32 Kevin
So if they buy a new police cruiser before the end of the year, it does not roll to the general fund, which essentially is the savings account.
00:07:38 Kevin
So there's just a lot of different things to be thrown at you here.
00:07:41 Kevin
But the big thing to take away here tonight is if the council does not pass a budget, it won't be the end of the world.
00:07:49 Kevin
You'll still have your emergency services.
00:07:51 Kevin
You just won't notice street signs being replaced, potholes being filled as quickly, things like that.
00:07:57 Kevin
You're not going to you may not have staff to collect your water bill payments to collect these things in person.
00:08:07 Kevin
You're going to go down to a skeleton crew and under contractual obligations, they're obligated to pay those employees for their time that's there.
00:08:15 Kevin
They just might not pay them right away.
00:08:17 Kevin
So what ends up happening is it's just like the federal government shutdown where the federal government would, you know, you're supposed to show up to the TSA.
00:08:27 Kevin
You don't get paid for your work there, but at the end, they reimburse you, but you have to come in if you're obligated to come in and that's
00:08:36 Kevin
That's the caveat.
00:08:37 Kevin
So there's still contractual obligations.
00:08:39 Kevin
There's a lot of different things that are going to happen once they pass the budget.
00:08:43 Kevin
Obviously, they're going to be some some weird shortfalls where things are not going to have happened.
00:08:50 Kevin
So just just a lot to consider now.
00:08:54 Kevin
If you're on the council and you are put in a predicament like this where you say, no, I am not voting on this budget because of this, this, this, and that, I think it is a very valid point to not compromise on your principles over something as being held at essentially, you know, political gunpoint to, you know, do somebody else's bidding, right?
00:09:17 Kevin
Because it is your budget, you own it as a council.
00:09:20 Kevin
So,
00:09:21 Kevin
you need to make sure that it's yours and it's something that you can vote for.
00:09:24 Kevin
It doesn't mean that you can't make compromises.
00:09:27 Kevin
It doesn't mean that you shouldn't try to come out with the best thing possible for the community, but you're on a deadline.
00:09:33 Kevin
You're on a crunch, and we've already missed that deadline, and so we are running dangerously close into missing a lot of the other deadlines like publication and getting these things passed before June 1st.
00:09:43 Kevin
And so, like,
00:09:45 Kevin
They may not go into a furlough type situation in an austerity budget if there's enough funds in the account.
00:09:51 Kevin
So let's say that they don't pass the budget.
00:09:54 Kevin
They pass the budget middle of May.
00:09:56 Kevin
Now everything is like, you know, a month behind, right?
00:10:00 Kevin
They pass the budget.
00:10:00 Kevin
Now they have to do all the hearings and the meetings and the public, you know, the public hearings.
00:10:06 Kevin
And then they turn around and they hit your budget with
00:10:10 Kevin
they hit your tax bills by, let's say, June 1st.
00:10:13 Kevin
Okay, so now everything's one month behind.
00:10:15 Kevin
Can the city continue to pay its payroll?
00:10:17 Kevin
Can the city continue to conduct business the way it normally would and still cover those without bouncing the check, right?
00:10:24 Kevin
Because you got to remember that a budget is one thing, but the bank account balance is a complete other.
00:10:30 Kevin
And it's not like the city is sitting on credit cards that they can borrow or a line of credit that they can pull out of to cover payroll.
00:10:37 Kevin
you can't really be stiffing people on their payrolls.
00:10:39 Kevin
Obviously, governments are a lot easier to deal with or a lot have a lot more leniency with things like that because it doesn't happen that often.
00:10:46 Kevin
They really put the screws to businesses and small business owners when you come with those shortfalls.
00:10:52 Kevin
So just a lot to kind of
00:10:56 Kevin
It's like drinking from a garden hose over here, guys.
00:10:58 Kevin
It's a lot to take in, and it's all going down in real time.
00:11:02 Kevin
So I know this isn't a live video.
00:11:04 Kevin
This is a recorded video to give you the quality and Kevin's handsomeness that you would always like to see, but also...
00:11:11 Kevin
I also want to make sure that it's crisp, it's clear, there's no clipping out, you have the full audio, and you can understand what I'm saying.
00:11:18 Kevin
And I know I talk fast, you can slow it down.
00:11:21 Kevin
If you don't think I'm talking fast enough, you can speed it up.
00:11:23 Kevin
There's plenty of things you can do with a non-live video.
00:11:25 Kevin
But that said, there is a lot going on.
00:11:29 Kevin
It is an intense time here.
00:11:31 Kevin
And so, like, you can understand why the general public, constituents,
00:11:40 Kevin
concerned citizens, people that are employed by the city might have a lot of anxiety because it's the anxiety is created by the the fear of the unknown, right?
00:11:54 Kevin
If you don't know if things are ambiguous and you don't know what's going to happen, you don't know if you're going to get your paycheck next week, you don't know what's going to happen.
00:12:01 Kevin
There's a lot of craziness, a lot of changes are happening.
00:12:04 Kevin
People are, you know, people are getting their, you know, their jobs cut.
00:12:09 Kevin
you can see why that would happen, or even the potential of their jobs being furloughed.
00:12:14 Kevin
That can cause a lot of anxiety and a lot of animosity.
00:12:20 Kevin
And so, but it's better if every single person educates themselves on how the system works, how the process works, and then we can work through it together.
00:12:31 Kevin
But know that it's not just the council, it's a budget that the mayor presents, and it is a
00:12:38 Kevin
process in which the council has to negotiate amongst themselves to get to a process and get to a final product that they are willing to accept and get behind and pass as a whole for the betterment of the city.
00:12:56 Kevin
And you don't want to compromise on your principles.
00:12:58 Kevin
The reason that you elected these individuals from each ward is because
00:13:05 Kevin
They stood on principles that you or a majority of people in your ward saw something in them and said, Hey, this is somebody I want to make decisions for me.
00:13:14 Kevin
And so you've got to kind of put a little bit of faith in that process that they're making the best decisions for you because you elected them, or at least a majority of people in your area did.
00:13:26 Kevin
And now they are going to the table, working together with each other to come up with a budget based on what they're presented by the mayor.
00:13:34 Kevin
So, throwing that out there to you guys.
00:13:37 Kevin
It is very intense.
00:13:38 Kevin
I would, we'll keep you posted.
00:13:41 Kevin
I'm catching up on all the prior council meetings that I've neglected to review for you, and I'm going to start making my way through that so that you've got something to reference back to.
00:13:50 Kevin
And then we'll also be keeping you posted with future events and outcomes of all of this turmoil.
00:13:57 Kevin
So stay tuned, guys.
00:13:58 Kevin
Life22, signing out.