George Borrello, Andrew Molitor
State Senator George Borrello and Assemblyman Andrew Molitor are criticizing Governor Kathy Hochul’s proposal to give the City of Dunkirk a $13 million loan.
The state representatives say the loan, which has a 7.75% interest rate and is required to be repaid over 15 years; would “…cost taxpayers millions in interest while doing nothing to correct the underlying problem: chronic mismanagement and a lack of oversight.”
Both Molitor and Borrello said that Dunkirk Mayor Kate Wdowiasz is being misleading in her public statements about the city’s financial condition.
Borrello said in an additional press release said Wdowiasz’s claim that State Comptroller’s Office is to blame for delays in issuing deficit bonds is false.
He said the Dunkirk Fiscal Recovery Act gave the city the authority to issue up to $18.5 million in deficit bonds—but only after the State Comptroller confirmed and certified the actual deficits. Borrello said that certification never happened because the city failed to submit the required documentation. As the Comptroller confirmed in a letter dated May 30, the city has yet to produce a report detailing the source and size of the deficits and has not completed its 2024 audit—both essential steps in the process.
Borrello also further criticized the state loan to the city, saying, “Even more concerning is a key condition of this proposal: accepting the loan requires the city to forgo its annual Aid and Incentives for Municipalities (AIM) base payment, $1.5 million per year, for the full 15-year repayment period. Although those funds would be redirected to cover the loan, the outcome is the same. The city will lose $22.5 million in direct state aid that would not otherwise need to be repaid and could support core services.”
Borrello stated the city needs more than “a temporary infusion of cash. It needs structure, oversight, and a clear plan to restore order.” The State Senator has introduced legislation to establish a Control Board for the City of Dunkirk that is currently the State Senate Corporations, Authorities And Commissions Committee. Assemblyman Molitor has introduced companion legislation in the Assembly.
If passed, the Control Board would have the authority to:
- Provide fiscal oversight, approve financial plans, and monitor budgetary compliance.
- Issue bonds to finance city-related costs, including refunding existing obligations and addressing tax certiorari claims.
- Have the power to provide financing at the city’s request for eligible expenses, subject to agreements between the authority and city officials.
The control board would consist of nine members who would serve without compensation but would be reimbursed for actual expenses incurred in the course of their duties.
The Authority would have the ability to issue up to $800 million in bonds to finance specific costs, particularly tax certiorari settlements initiated after June 1, 2025. Starting in 2031, the city may request bond issuances of up to $15 million annually to cover such liabilities, decreasing to $10 million in 2032. The authority would dissolve once its responsibilities are complete, with all rights, assets, and property transferring back to the City of Dunkirk.
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