On the eve of the Auburn City Council voting on the city's 2008-2009 budget, councilors can be happy about the progress that has been made over the last year when it comes to the outlook for their financial house. The announcement two weeks ago by Moody's Investor Services, taking away a “negative outlook,” is just the latest in a series of pieces of fiscal good news.

The credit for this new rating can widely be disbursed, especially to the leadership shown by City Manager Mark Palesh and City Comptroller Lisa Green, who have pushed several financial reforms that the city council has adopted to straighten out its fiscal house.

Progress can be seen in simple items, such as the budget now before the council that is fiscally conservative without a property tax increase.

One of the major decisions that the city has put in place is to repay the general fund because of a “planned draw down” by a former manager, mayor and city council of the Sewer Fund, which could rather be termed a failure of not being willing to do what was required for fiscal stability - incremental increases in sewer rates to pay for mandated upgrades put in place in the early 1990s. A failure of the mayors and city councils to do that may have been one of several reasons for Moody's original downgrading of the city's credit.

The other good news in the report is that the city has also made sure that its spending has come in under budget and, more importantly, built up its reserves. Instead of just having Moody's standard 5 percent in reserves, the city has nearly 11 percent in its rainy day fund, according to Palesh.

A note or two of caution outside city hall's control. While the state of New York has increased its aid to cities like Auburn (up 7 percent with April's state budget), that may not be the case in the future. The state, which still looks to always be on the verge of fiscal crisis, could wipe away such increases next year because of a projected $4.5 billion deficit.

Another is that Moody's recognized the city health insurance and pension savings have contributed to the rating upgrade. While a heavy swing in pension costs is not forecast, the city, which self-insures, has had a fairly healthy year, employee-wise, which has helped its financial performance. That may not always be the case.

On the whole city taxpayers should be very happy with the recent financial performance of city hall. Should they continue this tight financial management, they may be able to get the city an even higher bond rating, at least to “A” rating, which it had in 1996, until several mayors and city councils did not want to make tough choices.

Cosentino is a former mayor of Auburn and can be contacted at cozguytho@aol.com