The Newburgh City Council, acting in special session Monday night,  authorized the issuance of up to $15 million in bonds that promise to lift the city out of a hole that pushed the city to the verge of bankruptcy.

Resolution No. 164 of the City of Newburgh, New York, authorized “the liquidation of actual deficits in the general fund, special revenue fund and capital projects fund of the City existing at the close of the fiscal year ended December 31, 2010, stating the estimated total cost of liquidating the deficit is $15,000,000 and authorizing the issuance of $15,000,000 bonds of the City to pay the cost.”

The vote on the resolution was 4-0 with Councilwoman Marge Bell absent. Also absent was Acting City Manager Rick Herbek. Filling in for Herbek was George Garrison, director of the Department of Public Works.

City Comptroller Christine Mitchell was asked by the City Council on several occasions during the 30-minute meeting to explain the intricacies of the Newburgh Fiscal Recovery Act that was passed two weeks ago by the New York State Senate and Assembly and signed by the governor on July 20.

Mitchell, who has been on the job for a little more than four months, said she has been working extremely long hours trying to unravel the complexities of past budgetary decisions.

It is still too early to determine an exact number that is owed by the city, she told the council. To date, she said she has found $11.2 million that is needed to balance the budget.

Asked to explain the difficulty in establishing the extent of the city’s problem, Mitchell said, “the budget has not been accurate.”

“Is there any assurance that this money will not be used for anything other than current budgeted items?” asked Councilwoman Christine Bello.

City Comptroller Mitchell responded by saying that the state Comptroller’s Office will be closely involved in any city expenditures.

She said that she is working to have a Comptroller’s Office representative come to Newburgh to meet with the City Council to fully explain the process that the city will be involved in for the next 15 years or until the deficit financing is repaid.

“You are at the top,” she told the council. “You set the tone,” she said.

Several city residents said they were in favor of the city getting the necessary state support to dig itself out of its financial hole.

Mary Ann Prokosch said she wants the Financial Recovery Act “to keep us on the straight and narrow. Fifteen years from now, I’ll be 77 years old. I can’t be doing this again.

“We’ve seen this happen before. We have to learn not to touch the hot stove again,” she said, alluding to a child burning herself after being warned to stay away from the stove.

Janet Gianopoulos said, “I’m in favor of the act. I hope that we learn from our mistakes so that we don’t repeat them.”

Mayor Nicholas Valentine, following adoption of the resolution, praised State Sen. William Larkin and Assemblyman Frank Skartados for shepherding the Newburgh Fiscal Recovery Act through the state Legislature.

By ALLAN GAUL
agaul@tcnewspapers.com