Auburn Faces Budget Shortfall as Costs Rise

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Auburn, New York is facing a significant budget shortfall for the 2025-26 fiscal year, with city officials projecting a $1.2 million revenue gap and $800,000 in unplanned expenses. The primary driver of the problem is a sharp spike in health insurance costs, with premiums jumping 14% this year following a 42% increase the previous year. Several revenue sources, including hotel taxes and parking fees, are also underperforming.

Why it matters

Auburn's budget challenges reflect broader economic pressures facing many municipalities, as rising costs and lagging revenues strain local government finances. The city's reliance on its fund balance to cover the shortfall raises concerns about long-term fiscal sustainability and the ability to maintain essential services.

The details

According to The Citizen, Auburn's budget woes stem from a combination of surging health insurance costs and underperforming revenue streams. The 14% increase in health insurance premiums this year, on top of a 42% jump the previous year, has added significant unplanned expenses. Additionally, the city is seeing shortfalls in revenue from sources like the hotel tax and parking fees. However, the city's ambulance service is expected to generate a surplus.

• The 2025-26 budget year is projected to have a $1.2 million revenue shortfall and $800,000 in unplanned expenses.
• Health insurance premiums jumped 14% this year, following a 42% increase the previous year.
• Budget talks for the 2026-27 fiscal year are set to resume in March.

What’s next

Budget talks for the 2026-27 fiscal year are set to resume in March, where city officials will need to address the ongoing financial pressures and find ways to balance the budget.