The Ramapo Town Board approved borrowing $3 million from a police fund to cover daily expenses — including salaries — and keep the government operating until it receives payments for sales and mortgage taxes and repayments from the Federal Emergency Management Agency, The Journal News/lohud.com reports.
A resolution the board adopted last month said the town must replenish the police fund by Dec. 31, with interest of half a percentage point.
Supervisor Christopher St. Lawrence, the town’s acting finance director, said the loan doesn’t reflect any structural financial problems and he expects the town will repay the money on time. He also deflected criticism that the town is in financial trouble, despite a federal investigation focusing on issues concerning its loans.
“This really is a matter of cash flow,” he said. “We’ve done this before. We’re not waiting for anticipating revenues. The county is slow.”
The state Comptroller’s Office has put Ramapo on its list of municipalities in “significant fiscal stress.” Town officials blamed a ranking finance department employee, Melissa Reimer, for not reporting to the comptroller that the town was owed $3.5 million .
The credit rating agency Moody’s Investors Service has criticized Ramapo fiscal authorities for overestimating revenues to balance its budget.
Money owed to the town includes $1.4 million in sales tax revenues, $1 million from mortgage taxes, $1.6 million from FEMA, and nearly $2 million from processing tax bills for school districts.