The following letter is a written response to the New York State Comptroller’s Chief Examiner Lisa Reynolds at the Newburgh Regional Office sent on June 12, 2020. This letter is also attached to the Village of Maybrook audit for the public’s review.

Dear Ms. Reynolds, 
This letter is in response to an audit conducted in January of 2020 by the New York State Comptroller’s Office of the Village of Maybrook finances. Specifically, the audit involved the 2014-15 through 2018-19 fiscal years. In previous years, the Village Board appropriated a fund balance to offset the tax burden on the residents, and to make up for the revenue shortfall to meet expenditures. The Village of Maybrook identified the issues of the level of the Village’s fund balance in the Village’s accountants’ audit in the fall of 2018. The Village Board took immediate action in the 2019-20 budget with a 9% tax increase, with a ZERO fund balance being applied in the budget. I had a conversation with the New York State Comptroller’s Office before the 2019-20 Budget adoption, in which I was advised that the Village was “UNDER taxing the residents”. During the 2019-20 Budget year, the Village kept a watchful eye on expenditures, and we are expecting a surplus in the Village’s finances to be applied to the existing fund balance. 

A significant reason underlying the present level of the Village’s fund balance was the critical and urgent need in 2008 through 2015 that the Village address its aging and failing infrastructure that had experienced a lack of attention in prior administrations. The Village’s urgent infrastructure improvements included the construction of a new $5.3 million Sewer Treatment Plant to ensure the plant’s compliance with federal and New York State regulations, avoid significant threatened fines, and allow for commercial growth in the Village to expand the Village’s tax base and revenue stream. The Sewer Treatment Plant was the largest capital project in the history of the Village, and an extraordinarily significant investment given the size and tax base of the Village.  

In 2015, the Sewer Treatment Plant was completed with minimal fines incurred. The Village of Maybrook was able to secure an Environmental Facilities Corporation Grant with a .7 percent interest rate to lessen the surcharge burden on residents. However, during those years we experienced the great recession and the closing of the Maybrook Elementary School (the only school within the Village), which further dampened real property market values. 

In addition to addressing infrastructure issues, we also identified and put a plan in place to generate additional revenue to the Village to offset the tax burden on the residents. As discussed, the Village of Maybrook has limited revenue streams and the burden falls on individual taxpayers, as there is not a significant number of commercial taxpayers in the Village. Compounding this problem is that a number of businesses in the Village over the years have obtained tax assessment relief through litigation, which in turn lessens the Village’s anticipated revenue.

Beginning in 2012, the Village worked hard to generate new revenue through a concerted effort to increase economic development in the Village. In September 2017, the Board of Trustees introduced a plan to revitalize an area of the Village that incentivized shovel-ready sites for development.  This multi-faceted plan included the adoption of Zoning Code amendments that created a Traditional Downtown Design District, and a necessary, but costly, environmental review process that produced a Generic Environmental Impact Statement (DGEIS). The plan was adopted in 2018 and the Village has been working with the County and a private not-for-profit economic development organization to attract developers and businesses to this area.

In addition, the Village Board has for several years been in discussions with a particular developer on a project that would re-develop 70-acres of the former Maybrook Rail Yard to approximately 888,000 square feet of commercial use. The developer is currently in the final stages of their environmental review and we are hopeful a concrete presentation will be made soon. The present pandemic has obviously slowed down this process of late. This project will open a road through our Main Street and run parallel north of our village to create a Business Park with commercial rail service which will revitalize our Main Street and generate desperately needed revenue for the Village.

On April 27, 2020, the Village Board adopted the 2020-21 Budget with a 4% increase, with ZERO fund balance being utilized. The Village Board has continued corrective action and will follow the path of restoring the Village’s fund balance. We have been reviewing and will adopt a Fund Balance Policy before the end of 2020. 

The Village Board identified a deficit in the sewer fund in the Village’s audit in the fall of 2019. We adopted a Sewer Rate increase from $4.15 to $5.00 per thousand gallons to address the shortfall. Rates will be revisited yearly and adjusted accordingly, on a going forward basis. The apparent over-estimating of revenues is due in part to the Village’s water and sewer deficits and its related delinquent taxes which the Village is made whole by the County, but only in the following fiscal year. This will be closely monitored moving forward. 

In closing, the Village of Maybrook Board of Trustees have taken significant steps to correct the Village’s fund balance level in the 2019-20 and 2020-21 budgets, including both revenue raising initiatives and non-utilization of fund balance monies to supplement the budgets.   The Village will continue on this path by more closely monitoring our progress going forward on water and sewer issues, and implementing moderate budget increases to reach our goal.