Local governments across New York State are facing a delicate balancing act—managing financial sustainability, workforce challenges, and technological advancements while striving to maintain public services. The Bonadio Group’s 2025 State of the Local Government Survey provides insights into these challenges and highlights strategies for future success.
The survey captured data from government entities with less than 25 public service workers to those with more than 200 employees. Input was provided by 25 respondents from across Upstate New York who hold positions at government organizations that oversee counties, public authorities, and cities. The study presented a series of questions that covered five major topics: financial strategies, technology investments, labor shortage solutions, current top issues, and future outlook. Take a look at the key findings below.
1. Fiscal Stability: A Proactive Approach is Needed
- Nearly 50% of respondents have no long-term fund balance strategy.
- 25% experience ongoing cash flow concerns due to regulatory changes and external financial pressures.
- To generate new revenue, 90% of respondents have opted into adult-use cannabis dispensaries or onsite consumption licenses.
- Many are also exploring shared services with schools and neighboring municipalities to reduce costs.
2. Technology Gaps Are Hindering Efficiency
- 39% of respondents are dissatisfied with their current financial software.
- 88% have not updated their financial systems in over five years.
- 25% reported experiencing a cyberattack in the last two years, yet many governments lack strong security measures.
- Barriers to tech upgrades: 44% cite cost, while 31% cite resistance to change.
3. Workforce Shortages Are a Growing Concern
- 75% of local governments are struggling to recruit and retain employees.
- While turnover remains under 15%, filling vacant positions is a major challenge.
Only 46% have a formal succession plan in place. - 78% of government roles require fully in-person work, limiting flexibility in a workforce increasingly seeking remote or hybrid options.
4. Budgeting & Strategic Planning Are Top Priorities
- 50% of respondents say budget management is their biggest operational concern.
- Key financial challenges:
- Rising payroll costs
- Inflation & higher costs of goods/services
- Increasing climate-related emergencies affecting budgets
- 40% struggle to receive adequate bids in procurement processes.
- 37% report fraud risks significant enough to justify a dedicated fraud hotline.
5. Preparing for the Future: Key Trends to Watch
- Economic Pressures: Rising pension costs, healthcare obligations, and the 2% property tax cap will continue to strain local budgets. Shared services and efficiency improvements will be key.
- Demographic Shifts: Upstate New York’s population decline and aging workforce are increasing demand for senior services while shrinking the tax base.
- Technology & Digital Governance: AI-driven services, smart city technologies, and digital governance offer opportunities to improve efficiency—but governments must prioritize cybersecurity to mitigate risks.
Looking Ahead
While local governments in New York State remain cautiously optimistic, financial planning, workforce development, and technology adoption will be critical for long-term success.
Download the full study on our Government page. And if you need further guidance or have any questions on this topic, we are here to help. Please do not hesitate to reach out directly to Timothy Doyle, tdoyle@bonadio.com to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
