Fulton County’s preliminary budget for 2013 would cut spending 5 percent but raise taxes 15 percent, compared with the 2012 budget.
The proposed $89 million budget includes a $32 million property tax levy, up 15 percent from the current levy of $28 million, an increase about six times greater than allowed by the state-mandated tax cap. The Board of Supervisors would have to trim $3.4 million from the levy to get it within the county’s tax cap of 2.5 percent, said Budget Director Alice Kuntzsch.
This is not the final budget, Kuntzsch said, adding that the final tax levy increase will be less than the currently projected 15 percent.
“The board will do all it can do to stay within the tax cap,” she said.
Board Chairman Michael F. Gendron agreed.
“Our goal is to have a zero percent property tax increase. That is always our goal, but we also have to provide services,” he said. “We have a lot of work to do.”
Nonetheless, the board voted Aug. 13 to adopt a measure giving it the option to override the cap for 2013, should the need arise. The board is planning budget work sessions in the coming weeks. It has to adopt a budget no later than Dec. 3; the fiscal year begins Jan. 1.
As proposed, the preliminary budget maintains existing county programs and services, but includes the elimination of four full-time jobs: a clerk, two custodians and an account clerk.
The plan also maintains or slightly enhances funding for almost all outside agencies. For example, Cornell Cooperative Extension would see a $5,000 increase for its 4-H program, while the Mohawk Valley Economic Development District will lose its $15,000 allocation.
Kuntzsch said the county continues to see little or no growth in three crucial revenue streams: sales tax, mortgage tax and state and federal aid. Expenses, meanwhile, continue to increase.
The county will budget $17.1 million in sales tax revenue for 2013, compared with $16.8 million in the current year. Officials are awaiting sales tax figures for the third quarter to see whether they will finish the year on target.
The county’s local share of Medicaid costs is capped at a 3 percent annual growth rate but still will increase by $250,000, to $14 million, in the 2013 budget. The $14 million represents 44 percent of the total tax levy. Pension costs have also increased, although an exact total was not available Friday.
The budget contains no raises for employees who are members of bargaining units.
Kuntzsch said the county does have a strong fund balance, leftover money unspent in previous budget years. It stood at $10 million in the 2011 county audit. She said the board can use the fund and make other changes to the budget to reduce the proposed tax levy increase. She added that too much reliance on the fund balance can create a fiscal hole that has to be addressed in future years, however.
Kuntzsch said another factor affecting the tax levy is that the county saw its total assessed value increase a modest 1.2 percent this year. The total assessed value is used to divide the tax levy proportionally among the respective municipalities in the county and affects each municipality’s tax rate.
She said most municipalities in the county assessed their property values at less than 100 percent of true value. Those below 100 percent have their tax rates increased by an equalization factor. The values this creates, however, may be skewed because they are based on assessments that could be years out of date.
Only Gloversville and Bleecker are at true value. Values in other municipalities range from a low of 44 percent in Caroga to 90 percent in Broadalbin.
Gendron said he would like to see all municipalities at true value “because that helps spread the pie around. But that is a town issue.” The county cannot mandate municipalities undergo revaluation, and an attempt to create a sole county assessor was defeated at the polls.
“This is my 15th budget, and they are all unique, but we have an experienced group of people on the board,” Gendron observed. “I am optimistic that whatever the board adopts, it will best represent a lot of hard work by the board.”