(WNY News Now) – A high-interest loan proposed by Governor Hochul to aid the City of Dunkirk is drawing sharp criticism from local legislators, who call it a costly bailout that ignores deeper financial dysfunction.

New York State Senator George Borrello released the following statement after Governor Kathy Hochul’s proposed loan to the city of Dunkirk:

“We are deeply disappointed and concerned by Governor Hochul’s proposal to give the City of Dunkirk a $13 million loan at a steep 7.75% interest rate, to be repaid over 15 years. This would cost taxpayers millions in interest while doing nothing to correct the underlying problem: chronic mismanagement and a lack of oversight.

This isn’t a solution. It’s a temporary bailout that will ultimately leave the city deeper in debt.

Last year, we passed the Dunkirk Fiscal Recovery Act, delivering $18.5 million in emergency aid and authorizing the city to issue deficit bonds to repay it. The city spent the money—but never issued the bonds. Despite repeated requests, officials failed to provide the documentation required by the Comptroller to certify them. The repayment for the emergency aid is due in July 2025, and this proposed loan is meant to cover that without addressing the city’s fiscal negligence.

This is not the first time Dunkirk has ignored the Comptroller’s Office. The city still hasn’t submitted financial records for recent audits.

Yet the Governor’s response is more money – without conditions, oversight, or a plan to fix the dysfunction. We firmly believe this step will only perpetuate this ongoing crisis. A better solution would be for the Senate and Assembly to pass our legislation establishing a financial control board, which would provide the oversight, structure, and accountability that is clearly and desperately needed. It would help protect taxpayers and restore fiscal order.

The Mayor claims a control board is too costly but supports saddling taxpayers with millions in interest payments. That’s not responsible leadership.

Without real oversight, Dunkirk is headed for bankruptcy—nullifying contracts, gutting services, and triggering massive tax hikes.

We will not support any legislation that fails to include financial accountability, like a control board. Dunkirk needs real help—not another blank check.