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PEEKSKILL, N.Y. The city is showing signs of economic progress but Peekskill officials say challenges such as drastic increases in employee pension and benefit costs and new union contracts will hinder growth.
In her annual state of the city address Monday, Mayor Mary Foster read an 11-page report in its entirety that detailed this message to city residents and members of the Peekskill Common Council.
"Commerce, tourism, culture, technology artsthese are the five fingers of Peekskill's economic strategy as we move vibrant growth into the city," Foster said.
The mayor said Peekskill has seen requests for building permits increase in recent months and pointed to the recently renovated Inn on the Hudson as signs of a growing economy, as well as planned expansion projects by Northeast Appliance, Peekskill Brewery, White Plains Linen and Bertoline & Sons in the coming months.
The city also hopes to see several projects that have been stalled move forward this year, including the F Sharp Restaurant and Jazz Club, she added.
Foster listed a number of what she said are positive steps taken this year by city employees, such as Peekskill's new water filtration system, renovated storm water and sewers and work to improve roads and sidewalks.
The city is also in the process of collecting back taxes from property owners, with $875,000 accumulated by the city between 2005-2009 with $1.5 million in total promised to the city. About a dozen properties are expected to be acquired by the city through these proceedings, which the city will sell, Foster said.
Progress, however, will likely be offset by the city's growing operating costs.
The city will be forced to use $625,000 of the fund balance carried over from the previous year, plus another $375,000 to balance out the 2011 budget due to changes in workers compensation coverage and $250,000 in unexpected police workers compensation claims, Foster said.
"Except for the change in the worker's compensation insurance, the city beat the budget by $130,000," Foster said. "This is a huge achievement for all the city departments."
Union contracts are expected to be a costly endeavor for the city in the coming months, with police contracts for 2011 and 2012 yet to be negotiated. Blue and white collar union contracts are also still under negotiation for those years, according to the mayor.
"Although there are signs of improved revenue forecasts for 2012, union contracts will obliterate those gains," Foster said.
Video of the mayor's entire presentation can be viewed on the city's website and the written address will also be posted online at a later time.
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