Board struggles with possible big tax increase

For the first time in recent memory the Garden City Board of Trustees did not approve the Village budget at its organization meeting.

“There is more work to be done on this tentative budget, and more options to be considered,” said Mayor John J. Watras at the April 1st Board meeting. “For that reason, it will not be voted upon this evening.”

The tentative budget calls for the average Village homeowner to pay an approximate additional $203 in Village taxes. The budget totals $53,389,000 and calls for a tax rate of 44.35. This rate may lower as revenue enhancements are added, according to Village Auditor James E. Olivo. It is also possible that expense adjustments may increase the rate.

In comparison, the final budget for 2012/13 totaled $54,619,631 and called for a tax rate of 42.84. The average homeowner had to pay $97.20 in Village taxes. In 2011/12, the Village budget totaled $53,333,769 and the tax levy increase was 1.74 percent. The average homeowner had to pay an additional $108 in Village taxes.

On Monday, the Board of Trustees held two public hearings: one focusing on the tentative 2013/14 Village budget, and the other on the adoption of a local law which would permit the Village Board to override the state’s two percent property tax levy cap for the 2013/14 fiscal year.

Nobody spoke at the hearing on the tentative 2013/14 budget and it was adjourned. Mayor Watras promised residents that the Board will adopt a budget “very soon.” Trustees have until April 30 to amend the budget by resolution. The budget must be adopted by the Board by May 1, or else the tentative budget, with any approved amendments, becomes the actual budget.

On March 21, Village Auditor James E. Olivo filed a tentative 2013/14 Village budget with the State of New York which calls for a tax increase that falls under 4.2 percent, which makes it compliant with the state’s two percent property tax levy cap.

Trustee Andrew J. Cavanaugh, who serves as chairman of the finance committee, emphasized that the tax cap is on the annual levy (the amount to be paid as property tax by residents and businesses) and not on the tax increase, which is dependent on total revenues and assessed values, among other factors. The 3.66 percent tax levy cap yields a tax increase of approximately 4.2 percent.

At the public hearing focusing on a possible Village override of the property tax levy cap, Village Counsel Gerard Fishberg explained that the law protects the Village from any consequences handed down by the state comptroller’s office if the tax levy cap is exceeded, even if it is done by the Village unknowingly by mistake.

“Hopefully the Village will not need it and will not use it and will stay within the cap,” Fishberg said.

The only person who spoke during the tax levy cap override hearing was Garden City resident Kevin McCarthy. He asked if residents’ taxes will be increased 22.91 percent, which was the increase proposed in the original version of the tentative 2013/14 Village budget.

Trustee Cavanaugh responded by explaining that the tax increase was at that level when the budget process began in January. Since then, the Board has held several meetings and reviewed three versions of the tentative budget: the original with the 22.91 percent tax increase; a version which includes six firefighter layoffs and an 8.71 percent tax increase; and a version with no firefighter layoffs which calls for a 6.09 percent increase.

The Village is still negotiating with the Professional Fire Fighters Association (PFFA) regarding the layoffs, which were supposed to take effect on March 30 but have been delayed to April 6.

“The settlement which is being discussed with the PFFA, which has not yet been finalized, would for this budget and future budgets reduce the expense to the Village and avoid the layoffs,” Cavanaugh told reporters after a March 27th budget work session. “There are issues which they are finding difficult to accept and I respect that.”

Cavanaugh explained that the Board was still not satisfied with a tax increase that would require a tax levy cap override and directed department heads through Village Administrator Robert L. Schoelle, Jr. to make another four percent reduction to get the tax increase under the cap. This is the budget that was submitted to the state.

“If we have a tax increase in the range of four percent, it will be well under the state tax increase,” Cavanaugh said.

McCarthy said that over the past 20 years his taxes have increased by 300 percent. Cavanaugh responded that the Board has been responsive to the economy and have attempted to keep tax increases as low as possible over the past several years.

“The bottom line is, our expenses are out of control with what our revenues are, and that’s really the bottom line,” McCarthy said.

This fiscal year the Village was faced with costs associated with Hurricane Sandy which are expected to exceed $4.5 million. The Village should be reimbursed for 75 percent of the cost by the Federal Emergency Management Agency (FEMA), and 12.5 percent from the state. The Village’s portion of stormrelated costs will total between $700,000 and $800,000. This comprises 1.4 percent of the budget.

Leave a Reply