Finance Chief Warns of Depleting Reserves as Schenectady’s Budget Revenues Decline through April

One of the ⁣reasons for the potential budget gap is the ⁢delayed start of the ⁢city’s new school zone speed camera program. The program was ​expected to bring in $2.3 million⁣ in revenue from speeding fines over the year, but it’s now ⁤set to‍ launch⁣ in September, in time for the new school year.

The $2.3 million revenue projection was based on the assumption that ‌the program would be operational throughout 2025. Now, the⁣ city is likely to see only a fraction of that revenue in 2026.

Schenectady Police Chief Brian Whipple​ has expressed uncertainty about how much the ‌city will collect from the program ‍in⁢ the final four‌ months of⁤ the year.

“The original $2.3 million figure is‌ definitely unrealistic,” Whipple said. “That was our estimate in November, when we thought the⁣ program would be running for ​the entire school year.”

The police department is also unlikely to meet the city council’s projection of $1.1 million in⁢ parking ticket revenue for the 2026 budget. This is due to a reduction in parking patrols as a result of police overtime cuts in the budget, ⁣Whipple noted.

For the ⁣second​ time in three years, the city council and Schenectady Mayor Gary McCarthy had a prolonged ⁤dispute ‌over the budget last fall. ​McCarthy’s original 2026 budget proposal, submitted last October, would ⁤have raised property taxes by 17% ​in 2026 and exceeded the state⁢ tax cap.

In an ⁤effort to reduce taxes for residents and stay below ⁢the cap, the council increased⁤ revenue projections for several line items. They asked the police department to step up ​enforcement of parking tickets, raising ‍the proposed revenue‍ from $910,000 in McCarthy’s proposed 2026 budget to $1.1 million in the approved council​ budget.

The ⁤council​ passed‍ a $119 million ​budget on ​Nov. 1 ⁣that includes​ a ⁤2.6% property tax increase. McCarthy vetoed the plan, ‍calling the council’s projected revenues “fiscally irresponsible.” Budget negotiations continued ‌throughout the ⁤winter, with the council passing a second budget on Dec. 22 that included a 1.5% ‌tax increase. McCarthy did not ‌veto this plan. The city entered the 2026 budget process without the use of $6 million in American Rescue Plan Act [ARPA] funds that helped balance the 2025 budget.

With the delay of the school zone ‍camera ​program and lower-than-expected revenue from parking tickets and home sales so far in 2026, city Commissioner of Finance Derek Gugumuck ‍said this week that his office “anticipates that several of ⁣the revenue projections adopted⁣ by council may fall short, potentially leaving ⁢the city’s‍ unassigned fund balance depleted or⁣ in a negative position by year’s end.”

Gugumuck noted in an email that Schenectady currently has $3.6 million in fund balance to cover revenue ‌or expense shortfalls.

After receiving‌ home rule⁤ legislation from‍ the state‍ last year to introduce a school zone⁤ speeding camera‍ system, the city anticipated launching the program this spring, with the budget⁤ including the city’s estimate for $2.3​ million in ⁤ticket revenue from the program.

McCarthy said there were delays ⁤in negotiating⁤ and implementing the school⁣ zone camera program that have pushed the introduction ⁤back ‍to the⁤ fall.

“The program has been slower to start than I ⁢had ​expected,” McCarthy said.

The city signed a ⁤deal in ‍April with contractor Sensys Gatso to administer the school camera program.

City Council ‌President Carl⁣ Williams noted earlier this ⁢month that he had not been ​informed by ‍the ‌McCarthy administration that the school ⁤camera program⁢ had been delayed.

“This highlights the ⁤ongoing issues of not receiving information in a timely or appropriate manner,”‍ Williams said. “As a council, we’re not being⁢ informed​ as we should be.”

Whipple said that the‌ program is on ⁣track⁣ to start this fall. According to the legislation, ‌drivers will be ticketed if they are going 11 mph or more over the limit in school zones, which are 15-20 mph in the city depending on the school.

The city is finalizing the list of school⁣ zones where the cameras will ⁤be ‌installed. Whipple said that eight or nine ⁤school zones are expected to ‍be equipped with the cameras initially. The state legislation ‍allows the city to install the cameras in⁤ a maximum of 20​ school zones.

While the 2026 budget includes a projected $1.1 million in revenue for parking ticket revenue, Whipple said, the police ‌department is unlikely⁣ to reach that target.

The city​ collected $848,779 in parking fines in 2025, below⁤ the ⁣$910,000 ⁤projected‍ in the 2025 budget.

In the first four months of 2026, the city has collected $188,824 ⁣in parking ticket revenue, ahead of the $143,525 the city gathered in ⁢ticket money over the first four⁤ months of 2025.

Whipple noted that the city has received ticket⁣ revenue in the first ⁢four months of 2026 from ⁢tickets issued​ at the end of 2025.

Whipple ⁣said ​the police department has cut back on‍ its parking‌ enforcement details in 2026 after‍ police overtime for parking detail was reduced in the 2026 budget from $20,000 in 2025 to⁤ $12,500 this‍ year.

With budget cuts resulting in reduced parking tickets patrols this⁣ year and the agency asked to aim for a higher target for collections, Whipple said the‌ department ⁣is unlikely to hit the budget projections ‌with police prioritizing answering⁢ calls for service over parking‌ enforcement.

“We’re not doing as many details and we’re not spending our overtime details going out ⁢and enforcing parking when we’re more concerned with⁤ answering calls and bonding with ‌the community than enforcing parking‍ tickets,” Whipple said.

The 2026 budget includes ⁢$300,000 in projected revenue from the collection of delinquent parking tickets, with the city​ collecting $49,089 through‍ the‍ first ‌four months of the year. Whipple said it’s “not‌ looking feasible ⁢at⁢ this ⁤point” that the agency will meet ‌the council’s proposed number.

Delinquent tickets are defined as seven months or older ​by⁢ the city code, with the city contracting out to a third party for ⁤collection on the ‍overdue tickets. The city collected $122,507 in delinquent ticket revenue in 2025.

Whipple said he would like to‌ see more conservative⁤ estimates adopted by the council for ticket revenue in 2027.

“The estimates that⁣ I put a lot of time and effort into the budget since 2021, the numbers that I present to the council for the revenues and expenses are the real numbers,” he said.

Williams said that the council has not received any update from the⁣ city’s finance department on the revenue collected ‌by the city in the first four months⁣ of the year. ⁤McCarthy countered that the council is provided with reports on the city’s finances on a monthly basis.

A planned ⁣quarterly financial‌ presentation​ from Gugumuck at the council’s May 18 meeting was postponed after Gugumuck was unavailable to appear.

“We want to ensure that those projections⁣ are accurate, and if ‍we need to do any ⁢adjustments or reallocations,⁤ that is something ‌that we’re just​ trying to get ahead of as soon as possible,” ⁣Williams said.

The final 2026 budget included $3.5 million in projected revenue from the city’s HOMES program for the⁤ sale of foreclosed properties, a $500,000 increase over the projection in McCarthy’s proposed budget.

Gugumuk noted‌ in⁣ an email that the city’s five-year average for home sale revenues has been approximately $1.8 million, well short of the $3.5 million projected in the budget.

When asked if the ‌projected⁤ budget shortfall would⁤ affect the city’s operations this year or next,‌ McCarthy said the shortfall could ‍impact the city’s operations in 2026. Schenectady is projected to receive $3.9 million in temporary state funding⁤ in the 2027 state budget. McCarthy said‍ that the ⁤state funding could‍ be used to address the⁤ revenue deficit.

“With those numbers, I ⁣don’t see a scenario by which ⁤we’re⁢ going to be ⁢able to meet the council’s projections,” McCarthy said of the revenue projections. ‍“It’s just the reality we’re going to⁢ have to deal with.”