The Village of Saugerties adopted a $3.52 million budget for 2025-26 last week, just days after the municipality was marked as being under significant fiscal stress for fiscal year 2024 by State Comptroller Thomas DiNapoli.
Village mayor Bill Murphy said he wasn’t surprised by the distinction for a second straight year, though he noted that their score of 73.3 compared to last year’s 85 is a sign that they’re heading in the right direction. He added that the score reduction is the result of just under three months’ work from when they learned of their ranking to May 31, 2025, the end of fiscal year 2024.
“So we’re close to being out of the critical range,” he said. “But not quite yet.”
Murphy struck a lighter tone than a year ago when he pushed back on the “significant stress” designation, claiming the study was incomplete, inaccurate and lacked clarity.
“We have been financially sound in years past and the reason being not raising the village taxes for ten years,” Murphy said in April 2024. “As a matter of fact, from 2013-2023 we lowered the rate each year to try and assist our residents with increased assessments. As a result of this, we were required to apply for a TAN (tax anticipation note) in May 2023 which was fully paid back in three months by August of 2023. This is also reflected in the report without explanation.”
At the time, Murphy noted that the Fiscal Stress Monitoring System (FSMS) report only covered municipalities who actually submit their data, which happens infrequently, casting the Village of Saugerties as singularly troubled when hundreds of local governments — like the Town of Saugerties — failed to submit any data at all.
But around that same time, the village began correcting course.
“We’ve worked all year with the state comptroller’s office,” said Murphy last week. “My clerk, Peggy Melville, and, my treasurer, Paula Kerbert…the three of us worked diligently with the comptroller’s office to see where we can make improvements, what we can do.”
Murphy further contends that he knew they wouldn’t be able to fully rectify the issue overnight.
“I wasn’t surprised that we’re still in that category this year,” said Murphy. “We were told last year when we fell into this fiscal stress, it would take a couple years to come out of it.”
What caused the village to fall into fiscal stress was tapping into a dwindling fund balance for over a decade to offset property tax increases.
“Myself and my board for a number of years, especially during Covid, made a point of just trying not to raise taxes,” he said. “Hindsight is 20-20, right? We probably should have done a little bit more and built that fund balance up. We didn’t, and shame on us. All we can do is correct it and move forward. But it takes more than one year to recover from that, so we’re not surprised.”
Even with the issue coming from the best of intentions, Murphy said he realized where the village went wrong and committed to striking a prudent balance going forward, even if it means property taxes go up.
“Listen, it sucks,” he said. “No one takes it to heart more than I do. I mean, I had a crapload of sleepless nights last year when (the Comptroller’s report) came out. I get people’s concerns and I take full responsibility for it.”
In a press release announcing his office’s report on April 17, DiNapoli noted the potential for more municipalities to succumb to fiscal strife in the next few years.
“The number of local governments with a fiscal stress designation remains low following several years of emergency federal pandemic aid that helped stabilize their finances,” DiNapoli said. “With that aid coming to an end and uncertainty coming out of Washington on state and local funding cuts, local officials should closely monitor their financial condition so they can be prepared for any financial challenges that lie ahead. I encourage local governments to use our self-assessment tool to help them budget and avoid potential pitfalls.”
Murphy said the village would try to keep issues at the national level from derailing their efforts to continue moving fiscally in the right direction.
“With the economy right now and the current state of the country, then who knows, right?” Murphy said. “There’s never been more unknowns in the country than there is in the country right now. But I care about my little village and I try not to let the outside world affect what we try to do here … And I don’t always make the right decision, I’ll be the first to admit that. But if we continue on the path of what we did last year to make improvements and continue on those improvements, I think we’ll be solid in a year or two.”
In contrast to a year ago, Murphy said DiNapoli’s office has been instrumental in helping the village correct course.
Listen, the state comptroller’s (office is) doing their job, and they do it well,” Murphy said. “I’d like to thank them for all the assistance they gave us in this past year in getting us back on track. They were great to work with.”
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