Tuesday, August 2, 2011

Election Issue #2: Tax Cap

New York State now has a mandatory 2 percent tax cap. What does that mean for the town?

Well, taxes in the Town of Dryden have been pretty stable for several years. The tax rate, that part per $1000 that you pay annually, has not gone up at all. If you've paid more in town taxes, it's because your property's assessment increased and because of the rate of inflation, not because the town's tax rate went up. The town does not assess your property; the county does.

The tax cap, however, is on the levy, the amount raised across the whole town. The drivers of that amount are often uncontrollable. Since about half of the town's budget is in highways and road maintenance, a good part of the budget has to do with the cost of gasoline and oil-based products. Those costs never go down, and over time, they have increased dramatically. Other drivers include pensions and benefits. The town does not employ a lot of people, but those costs add up.

Our town supervisor tackled a massive and inappropriate fund balance when she first took over the books for the town, and the town board has established several designated reserves to help with large one-time purchases (e.g., highway equipment), retaining enough in their rainy day fund to support these current recession-driven rainy days. The town's goal is to keep within the cap without losing jobs, but that will require a careful balancing act.

Note that with a vote of 3 to 2, the town board can override the cap. As Supervisor Sumner has suggested, that's an extremely unlikely scenario.

The opposition talks about "lowering the property tax burden," which, as indicated above, has remained constant barring rising assessments and inflation. They speak of "more efficient local spending," and it will be interesting to hear what that means. Here's the link to the 2011 budget. To put it in perspective, it's a little more than half of the Dryden school budget. Try it yourself: What would you cut? What would you consolidate?

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