About the Fund Balance

On Friday, Mayor Kamal Johnson issued a press release announcing that the City had $2.5 million in its unassigned fund balance. This amount was $1.6 million more than previously believed, and the discrepancy was the consequence of certain allocated funds being counted twice. The error was caught and promptly reported by the City Treasurer Heather Campbell. Michael Hofmann, who is challenging Campbell for the office of treasurer, issued his own press release a few hours after the mayor's, claiming, "An inaccuracy of this scale is a massive breach in public trust." This morning Campbell issued her own statement:

The Hudson City Treasurer’s Office deals with tens of millions of dollars in complex accounting and forecasting of revenues and expenses. Like municipalities and organizations across the country, that accounting was made more difficult by the many uncertainties surrounding COVID and my office felt it would be irresponsible to not plan for the most difficult fiscal outcome. As all finance professionals do, we also have a mechanism for checking, finding and quickly disclosing any errors in our estimates and reporting. I am very pleased that our worst fears did not materialize and that we are closer to reaching our minimum balance in unassigned funds, required by statute the last several years. I strongly encourage the Common Council to reinstate the fund balance policy to ensure we can weather any future emergency.

The fund balance policy, which the City imposed on itself several years ago, requires that the unassigned fund balance can never be less than 25 percent of the total city budget. The 2021 city budget is $11,854,839; 25 percent of that is almost $3 million--$2,963,709.