Comptroller Miller Williams Releases Second Quarter Gap Report Response
City of Buffalo Comptroller Barbara Miller-Williams
City of Buffalo Comptroller Barbara Miller-Williams has filed her response to the Administration’s Fiscal Year 2025–2026 Second Quarter Gap Sheets Report with the Buffalo Common Council, pro viding an updated analysis of the City’s projected financial position and outlining key variances between the Administration’s projections and the Comptroller’s independent fiscal review.
As required by the City Charter, the Department of Audit and Control reviewed the Administration’s Gap Report using historical trends and transactional analysis to assess the reasonableness of projected revenues and expenditures for the remainder of the fiscal year. Because the precise timing of receipts and disbursements during the final six months of the fiscal year remains uncertain, adjustments were made to account for unexpected and non recurring transactions where appropriate.
The Administration projects a budgetary deficit of $24.6 million for the fiscal year ending June 30, 2026. In contrast, the Comptroller’s Office estimates the year-end deficit to be approximately $4.4 million. However, if the City is unsuccessful in collecting certain anticipated revenues—including Tribal Compact Revenue ($11 million), the Sale of Land and Buildings ($26.5 million), and Additional State Aid ($30 million)—the projected deficit could increase to as much as $71.9 million. Key drivers of this variance include differences in anticipated revenues recognized by the Comptroller’s Office but not reflected in the Administration’s projections due to timing, as well as expenditures expected to exceed budgeted levels.
The Comptroller’s Office estimates net revenues of approximately $687 million for Fiscal Year 2025–2026, which is nearly $42 million higher than the Administration’s projection. This variance is largely attributable to the potential receipt of $30 million in additional New York State aid pending legislative approval, as well as higher-than-anticipated Medicare Part D reimbursements and additional special revenue from prior-year reimbursable receipts that were not previously recognized by the City. Conversely, the Administration’s projected savings of $2 million in Judgments and Settlements appears unrealistic due to a $3 million settlement expense that is expected to be issued.
On the expenditure side, the Comptroller projects that total expenditures and transfers will exceed the Administration’s forecast by approximately $21.8 million, primarily due to under-budgeted costs associated with overtime, fringe benefits, pension obligations, and legal settlements. These projections remain subject to economic risks and ongoing fiscal pressures that may continue to impact the City’s financial out look.
The Comptroller’s analysis also indicates that the City is not expected to fully fund its Restrict ed, Committed, or Available Fund Balances during Fiscal Year 2025 2026. Historically, these reserves have served as an important financial cushion during periods when revenues fall short of budget or expenditures exceed projections.
Additionally, the City’s Available Fund Balance is currently below the level required under the City of Buffalo’s Fund Balance Policy, which calls for reserves equal to no less than thirty days of prior year expenditures. Pursuant to §20-17.5 of the City Charter, when fund balance levels fall below the required threshold, the Admin istration must submit a formal replenishment plan to the Com mon Council outlining the actions necessary to restore compliance within a specified period. The Charter further requires that the Administration propose annual replenishment actions until the fund balance is restored to the targeted level.
Comptroller Miller-Williams emphasized the importance of continued fiscal monitoring and transparency, stating: “While current projections indicate that revenues may exceed the Admin istration’s estimates, several key revenue sources remain uncertain and certain expenditures continue to trend above budgeted levels. Maintaining adequate financial reserves and closely monitoring fiscal pressures will be essential to protecting the City’s long-term financial stability and ensuring transparency for the residents and taxpayers of Buffalo. The Depart ment of Audit and Control will continue to monitor the City’s financial performance and provide updates to the Administration, the Buffalo Common Council, the Buffalo Fiscal Stability Authority, and the citizens and taxpayers of Buffalo.