What STATE funding does Albany receive & is it equITABLE?

New York provides two streams of funding to cities - Aid and Incentives for Municipalities (AIM) and Temporary Municipal Assistance (TMA).  In Albany when we speak about receiving money from NY State these are two of the primary vehicles.   

Anyone can download the data - the summary spreadsheet at the bottom shows the AIM and TMA funding for each city.  https://www.osc.ny.gov/local-government/data/aid-and-incentives-municipalities-aim-and-temporary-municipal-assistance-tma 

Our goals were to understand this funding, compare Albany's funding versus other cities and determine if the funding is equitable or out of balance.

You can use the spreadsheet below to follow along with the analysis if you want.

• AIM funding has remained unchanged for each city for years.  The 2017-18 budget has the same funding by city as the 24-25 budget.  Note that leaders have attempted to give visibility to the situation; Albany, Schenectady and Troy Mayors Sheehan, McCarthy and Mantello wrote this op-ed (paywall) nearly a year ago.
• 61 cities receive AIM payments, those cities have an aggregate population of 2.267 million people
• New York City is not a part of the AIM program
• Statewide AIM payments are $647 million and statewide TMA payments total $45 million. 

This brings up a few questions - is the distribution equitable?  And if the distribution is not equitable, how inequitable is it?  Let’s dig into the AIM program.  

The first thing that we will do is add in a population value (using US Census 2023 population figures) and examine the distribution of aid of the top 15 cities by population.

Even the most casual examination suggests an imbalance in the funding.  For example, Albany has 70% of the population of Syracuse but receives 17% of the AIM funding.  Given this, let’s extend the analysis and look at AIM distribution on a per capita basis. 

The variability (and unfairness) of the AIM funding stands out when looking at per capita distribution.  Statewide the AIM funding per capita is $285 per person ($647mm of funding for 2.267mm people).  

Given this there are winners and losers that are significantly above the average.  These are all cities with population greater than 50,000 listed with their Per Capita AIM payments.

Perhaps there are reasons or a rationalization behind the variability, perhaps it is just a historical thing that is perpetuated to current day.   It is a struggle to look at the data and see that there is a rational, explainable basis for the AIM distribution variability.  In addition, this is a funding stream that has remained constant so the unfairness to cities such as Albany has compounded over time.  Let’s try to quantify this unfairness and see if it is material.

Above we demonstrated that the average AIM funding is around $285/capita.  What if all cities received AIM funding at this consistent rate?  What if all cities received this rate for the past 7 budget cycles?  How would the actual distribution of AIM funds differ from this hypothetical scenario?

Let’s extend the table with a couple of fields - 

• Total AIM payments from 2017-18 to 2023-24 - this is the Enacted Budget AIM Payment x 7 years, recall that AIM payments have not changed for at least 7 years
• Hypothetical Total AIM Payments 2017-18 to 2023-24 at $285/capita rate - population x 7 (years) x $285 (the statewide per capita AIM distribution rate)
• Actual vs Hypothetical Difference - (negative numbers) are bad - positive numbers suggest a city that has received more than their fair share 

In this analysis Albany has received $113 million less AIM funding in reality versus a hypothetical scenario where funding was distributed on a consistent per capita rate.  Buffalo has received $580 million more and Syracuse $211 million more than a consistent distribution scheme. 

Let’s look at one more funding stream - Capital City Funding.  From the 2024 City of Albany Budget Book:

CAPITAL CITY FUNDING:  fiscal aid provided by New York State (NYS) to make up for the lack of Aid and Incentives for Municipalities (AIM) Albany receives per capita compared to all other NYS cities with populations of 50,000 or more

In 2024 the City of Albany received $15 million of funding.  How does this change the per capita distribution of funding?

 Adding in the Capital City Funding significantly changes Albany’s per capita state funding from $125/person to $273/person.  Sorting New York cities by state funding per capita, Albany moves from 8th to 6th when you add in the Capital City Funding, behind Utica ($283/person) and slightly ahead of Troy ($271/person).  

The 2025 City of Albany Proposed Budget suggests an increase in Capital City Funding:  “...this budget includes Capital City Funding of $20 million.”  How would that change the funding?

 With this increase in funding, the City of Albany would be the 5th highest funded city on a per capita basis, behind Rochester ($426/person).

1. New York State distributes $647 million of AIM funding per year using distribution levels to cities that have remained unchanged over a decade
2. Distributions to cities show an incredible imbalance with no reasonable explanation for the imbalance that shows up based on size of city
3. Albany’s imbalance, when measured against a consistent, statewide per-capita distribution measure demonstrates an underfunding that is greater than $100 million over the last seven years.
4. Capital City Funding – historically and proposed 2025 – does close the funding distribution gap to a significant degree.

We can envision some additional questions that we may want to answer in the future.  We also ask any of our readers to ask follow-up questions as well:

1. Does the Temporary Municipal Assistance (TMA) funding streams carry the same imbalance and, if so, what is the level of unfairness?

Questions or comments?  email us at AlbanyDataStories@gmail.com