Chautauqua County’s state representatives are asking Gov. Kathy Hochul to veto a $13.7 million loan to the city of Dunkirk.

Sen. George Borrello, R-Sunset Bay, and Assemblyman Andrew Molitor, R-Westfield, sent a letter to Hochul on Wednesday asking her to veto legislation she asked the state Legislature to approve in favor of legislation Molitor and Borrello introduced earlier in the session that would create a financial control board for the city of Dunkirk.

“This isn’t a rescue, it’s a high-interest burden that will worsen the city’s fiscal standing,” Borrello said. “What Dunkirk needs is structure and discipline, not another loan that rewards failure. We’re also hearing directly from city residents who’ve contacted our offices to voice their opposition to this plan. People are concerned, and rightly so–they see this for what it is: a short-term patch that creates long-term pain.”

Molitor debated the bill twice this week on the Assembly floor. Assembly members approved the bailout largely along party lines, 88-47, with Molitor and Assemblyman Joe Sempolinski voting against the bill. Molitor was the only Assembly member to speak in either floor debate on the bill on June 16 and June 17.

The June 16 debate came more than 10 hours and 45 minutes into an 11 hour session and was the last bill to be debated that day. It was laid aside and then passed on June 17.

Molitor said he would have approved legislation passed in 2024 approving $18.2 million in municipal bond funding to help the city out of its deficit because it both helped eliminate the deficit, allowed the city enough money to pay back the bonds and came with oversight from the state Comptroller’s Office. The 2025 bill is a different animal, Molitor said, and the state shouldn’t approve a loan without oversight from the comptroller and without knowing how big the deficit actually is.

“In the intervening months since that legislation was passed the city’s financial situation has worsened,” Molitor said on the Assembly floor. “The deficit has grown to over $20 million and we still don’t know what the total deficit amount is going to be because the audits have’t been completed. It has been reported that the comptroller’s office has opened an investigation into the city’s finances and there are many issues with the city’s operational budget. Property taxes this year have increased 84% and that’s with the hope that the budget will be balanced. There are residents in the city of Dunkirk who are coming to the Real Property Tax Department in the city and they are struggling. They don’t know whether they’re going to have to pay their property taxes or whether they’re going to have enough money for their basic necessities.”

Both Borrello and Molitor say there is growing opposition to the loan from Dunkirk residents, Common Council members and now county Legislator Bob Bankoski, a Democrat who represents Dunkirk in the Chautauqua County Legislature.

Molitor also questioned the high interest rate on the loan – Borrello and Molitor said interest will cost the city $10 million over the loan’s 15-year term – as well as why the city will be required to forfeit its AIM funding and doesn’t require stringent controls and financial accountability.

“With the loss of their AIM funding, which is contemplated by this loan, and the anticipated repayment of municipal bonds once issued, Dunkirk taxpayers will likely see more dramatic tax increases,” Molitor said. “These tax increases and their detrimental effect on Dunkirk’s economy will drive away businesses and residents in an area in my district that is already depressed. If your car tire pops you wouldn’t try to put air in it, you’d fix it. Why would we give the city more money without requiring stringent controls and financial accountability so that we can have a fix? … I fear we will be back here before long addressing the same underlying problem this bill fails to fix. For all these reasons I cannot ask any of you to support this bill and I will not be supporting it.”