Politics is not a spectator sport: Everyone is responsible for the success of government operations. Here another dive into the proposed 2025-2026 budget, to ascertain if the numbers reported there make any sense. https://vi.potsdam.ny.us/wp-content/uploads/2025/03/Budget-25-26-V2.pdf
The first column on the Tax Rate Schedule on page 30 (reproduced below) lists how much money each department needs to run its operations. So for example the HydroElectric plant requires a $608,504 appropriation for the next fiscal year. (If the magnitude of this number shocks you and you wish to know why it costs so much to run a couple of hydroelectric power generation plants, then look at pages 24 and 25.)
The column after Appropriations is titled “Less Non-property Tax Estimated Revenues”. In other words, not all revenue for the appropriations need come from property taxes! And for the HydroElectric Fund, the “non-property tax estimated revenue” happens to be exactly equal to the department’s appropriation of $608,504 (a very precise estimate!). This is so misleading!
Where, if not property taxes, does the revenue to the HydroElectric Fund come from?!? Well, it is coming from the power and credit generated by the hydroelectric dams. And herein lies the problem that no administration will discuss: the credit generated by the two dams is tiny compared to the cost of running the plants! In all of fiscal year 2021-2022, the dams generated $80,595. In all of fiscal year 2022-2023 they generated $136,201. And in all of fiscal year 2023-2024 they generated $144,208.
But the Hydrolectric Plant requires $608,504 the next fiscal year! So there will be another shortfall of $500,000 that will be paid by our property tax dollars! Is that even permitted? Quoting from an Office of the New York State Comptroller’s Division of Local Government Report entitled “Examination on the Village of Potsdam Financial Condition” from May 2017: “the general fund has been loaning money to the hydroelectric fund to help subsidize its operations. As of May 31, 2016 the hydroelectric fund owed the general fund about $222,000, and it had no cash available to repay the loan…While General Municipal Law allows the Village to temporarily advance (loan) moneys from one fund to another, the borrowed cash must be repaid by the close of the fiscal year in which the advance was made. The use of interfund advances is a permissible form of short-term borrowing to meet current cash flow needs, but it is not intended to be used as a long-term approach to provide financial resources from one fund to another fund”. No administration wishes to discuss this problem as there is no obvious solution, but the Treasury department has been bailing out the HydroElectric plant for 10 years, illegally to my understanding. As the Treasury department has not released audit reports since May 31, 2022, we do not know exactly how much the HydroElectric Fund owes the General Fund, but I estimate it to be well over $1,000,000.
So I would encourage every village resident to question why the Treasury Department misguides us into a false belief that the dams pay their own way. They do not. Is it not time to sell the dams, or to simply shut them down? At the start of the village 2021 administration, Steve Warr and myself were seated on a Hydro Committee in an effort to find a way out of this financial millstone drowning our finances. Unfortunately, the Mayor dissolved that committee and attempted to resolve the problem on her own, apparently to no effect. Had I a vote, I would have voted to shut both dams down.
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