October 15, 2013

In My Opinion: Town may need to exceed tax cap

By BERNIE BASSETT, Supervisor, Town of Plattsburgh

---- — In an effort to control rising property taxes, Gov. Cuomo and the New York State Legislature placed a cap on expenditures that municipalities can make in a given year.

Under the current formula, it will be necessary to pass a local law if a municipality intends to increase property taxes for the year 2014 beyond 1.66 percent.

Most residents agree that it is critically important to control municipal expenditures and that this cap is a step in the right direction to achieving that objective.

The Plattsburgh Town Council is considering passing a local law to override the cap for the budget year 2014. I feel it is important that I share with property owners in the Town of Plattsburgh some of the reasons why, this year, as others have had to do, it is necessary for us to override the cap and the impact on property taxes that will create.

The Town of Plattsburgh has been fortunate over the years to receive measurable sales-tax revenues and, as a result, the Town of Plattsburgh, unlike most towns, does not have a town tax and only very recently imposed an extremely modest highway tax.

To give some relevant examples, this year the highway tax in three neighboring towns are $2.37 per $1,000 of assessed value, $4.49 per thousand and $1.48 per thousand. The highway tax in the Town of Plattsburgh is 72 cents per thousand, much lower than most towns in the county.

What has happened in the past is that the cost associated with maintaining the system of roads within the town has been funded by sales-tax revenue. Unfortunately, sales-tax revenue is not always predictable and, as a result, I feel it is important for the costs associated with maintaining our highway system to be funded entirely through a highway tax.

I would add that it is very tempting for elected officials to kick the can down the road, which, in essence, places the burden of dealing with fiscal problems on future Town Councils, but, in my judgment, that is neither responsible nor ethical.

Making road maintenance independent of sales tax will also enable the town to build a fund balance, something that does not exist, as recommended by the Comptroller’s Office and monitored by the new fiscal-monitoring process imposed on municipalities.

The Town of Plattsburgh has been extremely successful in attracting business. One of the reasons for that is that the town has had a first-class infrastructure, in terms of roads, water and sewer facilities, planning, zoning and all the other administrative functions that are necessary to promote and sustain a growing economy that creates new jobs and builds our tax base.

The decision to raise taxes can be avoided in the short run through borrowing or letting our infrastructure deteriorate, but neither of these solutions is, in the long run, sustainable. A debt-ridden community with a crumbling infrastructure will never attract businesses that are necessary to maintain a reasonable tax base for homeowners.

I believe it is important to provide the citizens of the town with specifics, in the event the town decides to override the tax cap and increase the highway tax.

For example, based on the tentative budget that has been made public, a home with an assessed value of $100,000 would experience an increase in the highway tax of approximately $138. Again, this number is based on the tentative budget prior to budget meetings and final negotiations.

It is critical to note that the town is currently doing everything in its power to reduce expenditures, but it is equally important to share the state of the town and our efforts to remain fiscally secure and sustainable.

I have often stated that it is important to operate a town like a business, and this is what I intend to do. I firmly believe it is in the best interests of the residents of the town to be made aware of our financial challenges in a realistic and forthright way.

The tentative budget does just that, and now we will begin the process to reduce expenditures and develop the most responsible final budget possible.

Bernie Bassett is supervisor of the Town of Plattsburgh.