September 11, 2023 |City of Lynn, City Services, From the Mayor, News, State of MA

City pays off loan, removed from state financial oversight

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The City of Lynn has repaid $14 million in deficit bonds it was authorized by the state to issue in 2018 and is no longer under the financial oversight of the Commonwealth.

Lynn made a payment of $8.1 million on September 1 to complete repayment of the 10-year loan five years early. The City borrowed $9.5 million in Fiscal Year 2018 and $4.5 million in FY 2019 to make up for shortfalls in the general operating budget.

“We are very pleased to put this behind us,” Mayor Jared C. Nicholson said. “We appreciate the collaboration with the state over the last five years. We look forward to continuing to operate the City in a manner that is fiscally responsible at all times.”

Nicholson and the City Council received a letter dated September 5 from Matthew J. Gorzkowicz, the state secretary of Administration and Finance, officially notifying them of the removal of state oversight. Requirements that will no longer be needed include: completion of a pro-forma tax recap upon the City Council approving a budget; submission of audited financial statements prior to approval of the tax rate; submission of a balance sheet in order to have free cash certified prior to the approval of a tax rate; and submission of quarterly reports to the state Division of Local Services.

“This is a great step forward for the entire City. It means more resources can be allocated towards improving our local infrastructure and serves as a promising sign for Lynn’s future growth and development.”

City Council President Jay Walsh

While the City was under state oversight, Sean Cronin, senior deputy commissioner of Local Services at the Department of Revenue, served as fiscal stability officer, charged with providing assistance in all matters relating to municipal financial affairs.

Nicholson said eliminating this debt provides financial flexibility moving forward.

“As we have laid out in our financial plans, this step creates needed capacity for us to advance our goal of a new Pickering Middle School,” the mayor said. “We wouldn’t be here without the shared sacrifice and ongoing discipline on the part of the previous administration, my fellow elected officials, our current financial team, led by Chief Financial Officer Michael Bertino, and the entire team of City workers.”

The above press release was submitted to us by Mayor Nicholson’s office.