Town of Wallkill seeks $4 million state aid to cover budget shortfall

Wallkill taxpayers could face a 2027 property-tax increase of well over 70 percent unless Albany helps close a $4 million budget hole, a prospect that would ripple through police patrols, road work, and other basic town services.

Town Supervisor Frank DenDanto III said the town was dealing with “a significant budgetary shortfall” caused by “years of fiscal mismanagement” and asked the state for immediate emergency aid to bridge the gap. He said the town has already cut the 2026 police and Department of Public Works budgets by 20 percent, including leaving four police officer positions vacant.

The request now lands with State Sen. James Skoufis and Assemblywoman Paula Kay, who said legislative staff were reviewing Wallkill’s finances. Skoufis said the timing should not block action because budget negotiations are still underway, leaving open the possibility that the town’s plea could still be folded into state-level talks in Albany.

The size of the ask, and the warnings attached to it, put renewed scrutiny on how Wallkill arrived at this point. A 2010 state comptroller audit said chronic overspending drained nearly $6.3 million from town coffers between 2006 and 2008. More recently, a 2020 report said Wallkill was staring at a nearly $3 million budget deficit for 2021 in the wake of the COVID-19 pandemic, with cuts to police and public works already looming.

The town’s recent governance history has added to the pressure around DenDanto’s appeal. In March 2025, former town comptroller Toni Tracy reached a $300,000 settlement against DenDanto over hostile-work-environment and retaliation allegations, after a Town of Wallkill board investigation substantiated her claims. That episode, coupled with earlier fiscal warnings, is likely to shape how residents and state lawmakers judge the credibility of DenDanto’s explanation that the current deficit reflects long-running mismanagement rather than a one-year setback.

Wallkill’s accounting department says town finances are handled under Office of the New York State Comptroller guidelines, generally accepted accounting principles, and town code, with required budgets and financial reports posted publicly. That makes the current shortfall more than a bookkeeping problem: if state relief does not arrive, town officials may be forced to choose between deeper service cuts, further borrowing, or a sharp tax increase that would hit homeowners across Orange County.