SYRACUSE -- Budget troubles have surfaced in Syracuse as the city is trying to address a $900,000 deficit in the park impact fee fund.
Development fees provide money for the fund, to pay for new parks and improvements to existing parks.
City leaders believe the first phase of development of Jensen Nature Park is a large part of the problem.
The recently discovered $900,000 deficit, combined with a $2 million bond used to develop Jensen, which is now estimated to be a $7.5 million park at 3726 S. Bluff Road, have elected leaders looking for ways to bridge a "huge" gap in the city budget, while maintaining services.
Compounding matters is the fact previous leaders have taken Syracuse to its maximum bond debt to build a new city hall and fire station, Mayor Jamie Nagle said.
The city, in 2006 and 2008, issued a combined $15 million in bond debt for new buildings, said Amber Fowles, city finance manager.
Those building bonds do not include the 10-year, $2 million bond issued in 2005 to develop the Jensen Nature Park.
"We have a beautiful park and we have beautiful new buildings. But it has come at the expense of meeting critical services in the city," Nagle said.
"Syracuse is operating at the lowest operative level as possible. If our fire truck were to break down and need a major repair, we would not be unable to (fix) it," she said.
Nagle said she is unwilling to assign fault for who is responsible for the debt the city is faced with. However, the first-term mayor said she would hate to imagine what would have happened had the deficit continued to go undetected.
The deficit looms large in a city that in fiscal year 2009-10 had a total general fund budget of $5.6 million to pay for the ongoing cost of operating the entire city.
"We are going to have to be very innovative," Nagle said of finding a solution.
Based on the size of the deficit, the city will be unable to address it through spending cuts alone, she said, unless it makes cuts to its emergency services.
The $900,000 deficit in park impact fees was discovered after Fowles was hired as finance manager in March and she reviewed previous budgets, Nagle said.
"The financial status we're in now is not a result of decisions made by the current council," Nagle stressed.
She is concerned that it appears there was never really a cost estimate associated with developing the park.
"(Previous city leaders) never came out with 'This is how much it was going to cost,' " she said, "until it was (completed)"
It also appears the Jensen Nature Park was never put on the city's capital facilities plan, a requirement if park impact fees were being used for its development.
As a result, Nagle said, the city is facing a deficit it does not have the money in its fund balance to cover.
Fowles said Syracuse has a fund balance of $300,000, which meets the 5 percent minimum the state requires the city have on hand.
The city took on debt quickly by constructing buildings that will meet the projected build-out population, Nagle said. The mayor likens that action to a newlywed couple whose first home is a two-story mansion with many bedrooms based on the notion they will some day have children.
Leaders have met with the city's banking adviser to discuss refinancing the building bonds to free up capital, Nagle said, but doing so would incur more in penalty costs than it could gain through the refinancing.