Troy allocates its last MAC funds

Final payment will conclude era of debt for the city

After a generation of sending about $6 million annually to the Troy Municipal Assistance Corp. to rescue the city from debt run up in the 1980s and 1990s, the money is flowing the city’s way for two final payments.

Mayor Patrick Madden has asked the City Council to allocate the nextto-last payment of $1.22 million from the Troy MAC to pay two onetime bills and to place some funds in reserve.

The final payment comes when the Troy MAC receives a federal tax refund from the IRS, completes an audit and shuts down for good after paying its final operating bills. The money left over from what the city estimates will be $160,000 before the bills are submitted, will come back to Troy.

Madden, who is in his second and final fouryear term as mayor, said it’s important for people to know that bills have to be paid and it’s not wise to venture down the path of the late 20th century that saw city government spend funds it didn’t have.

“People demanded services at a time they didn’t want to pay for. I hope that we have learned a lesson,” Madden said. Learning that lesson meant sending money to pay off a debt and forgoing services and ordinary purchases.

The state Legislature created the Troy MAC to give the city access to the bond market with the ability to borrow up to $71 million due to the state of the city’s finances. About $6 million was placed in reserve to pay off bonds in case the city didn’t have the cash.

That $6 million left the three mayoral administrations before Madden’s dreaming of what they would have done when the money was given back to Troy. But in a twist that seems to mark Troy’s finances, it turned out the Troy MAC would hand the money over to the state. Legislation introduced by Assemblyman John T.

McDonald III, D-Cohoes, and Sen. Neil Breslin, D-Bethlehem, became law and Troy received the $5.3 million it was due.

The city is treating the payment as the one-time infusion of money that it is, City Comptroller Andrew Piotrowski said. That’s why it’s going to resolve an unpaid city responsibility for the 1 Monument Square project, take care of shortterm debt and be set in reserve, he said.

The ordinance allocating the funds goes before the City Council at the ThursdayFinance Committee meeting before a final vote at the July council meeting.

Piotrowski said $500,000 would go to pay the final portion of the city’s $2 million match for a state grant for redeveloping the vacant 1 Monument Square site where City Hall once stood. In 2011, the city covered $1.5 million of its share, which was $500,000 short. The city will now allocate the funds ending the shortfall.

Troy will then place the remaining $204,476 in the city contingency funds, which are unallocated in the budget. It’s expected the money will go to deal with higher prices caused by inflation.

The city will then wait to see how much it will receive in its final payment from the Troy MAC. That may come by the end of the summer.