The City of Utica faces a $1.4 million bill it owes to the school district, but it can't pay. Our Andrew Sorensen looks into what the city is doing to cover its tab and avoid the problem in the future.

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UTICA, N.Y. -- A joint Education and Finance Committee meeting Monday night tried to figure out where to get $1.4 million the city doesn't have.

"Basically what this meeting is is to come up with a conclusion of how we're going to get the uncollected school district tax or property tax to the school district," Utica Common Council Member Samantha Colosimo-Testa explained.

The city still owes the Utica City School District $1.4 million on last year's taxes, which were due June 30th.

The problem stems from yearly uncollected property taxes.

"When they didn't have the money they used to go into the reserve fund, take the reserve fund, pay the school district off. Well now there's no money left in the reserve fund, that's the problem that we're having," Colosimo-Testa said.

Some council members speculate the property tax problem is worsened by tax forgiveness when foreclosures are purchased by the Urban Renewal Agency. The city also has issues using school money thrown into the general fund.

The committee has proposed a new ordinance that would stop that practice with a trust fund for school taxes.

"It actually secures the money so that if somebody needs to borrow that money, they can't touch it," Colosimo-Testa said.

The City Comptroller Michael Cerminaro disagrees with the council's efforts at this point, because he says they have bigger fish to fry.

"We still owe them $1.4 million, where are you going to get the money? You've got to take out a TAN."

A TAN is a Tax Anticipation Note some Common Council members would like to take out to pay the district immediately.

"When you budget for something the city doesn't get, we have to go short term borrow in order to pay that debt," Colosimo-Testa said.

Cerminaro says it may save the district a headache, but it gives a bigger one to the city.

"TAN must be paid back within the fiscal year, the fiscal year we're in. You're never going to collect all the money! So what are you going to do when the TAN comes due?" he asked.

The proposal would also establish a regular monthly schedule for payments to the district, but it would have to be adopted by the school board.

If the Common Council approves the new ordinance during its next meeting, members say they would still need to find the right bank before it would take effect.