The Amsterdam Town Board is considering implementing a highway use tax to balance the 2013 budget.
The idea was discussed at last week’s board meeting along with a $4.1 million preliminary budget.
According to Supervisor Thomas DiMezza, the tax would generate a levy of roughly $340,000, money he said the town really needs.
“We’ve depleted our fund balance,” he said. “If we don’t implement this tax we’re in jeopardy of running the town into the red next year.”
If the tax is put in place, an owner of a $100,000 home in the town would pay roughly $87 a year.
Both DiMezza and Town Attorney Charles Schwartz emphasized that the new property tax would not be a town tax, but rather a special highway tax.
“We haven’t ever had a town tax,” Schwartz said, explaining that all the money collected would go into a Highway Department account to be used exclusively for road work and equipment, rather than deposited into the general fund like a normal property tax.
“Right now the Highway Department only has $1,200 of unappropriated fund balance,” DiMezza said. “I’ve already been putting off road maintenance.”
He said town equipment is deteriorating, mentioning 7-year-old trucks in need of repairs and the rising costs of snow removal machinery.
“With everything going up, we don’t have enough to cover expenses,” he said. “There’s no way to cut enough from the budget to avoid this.”
Schwartz said the idea for the new tax was run past the state auditors for approval and “they all said it was OK because we have such a tight budget.”
The Town Board will work on the budget for the next few weeks. A public hearing on both the possible highway tax and the budget will be held Nov. 21 before the 7 p.m. regular board meeting.
According to Brian Butry, a spokesman for the state Comptroller’s Office, establishing a new highway property tax does not require a public referendum or state Legislature ratification, so once the public has had its say, the tax will be up to a board vote.
However, the new tax would most likely push the town past the state-imposed cap on tax levy increases, which will necessitate another public hearing and board vote, Schwartz said.
None of Amsterdam’s Town Board members could be reached for comment on the matter, but DiMezza expects some resistance to the idea of implementing a new tax.
“Nobody ever wants a new tax,” he said, “but with this one, at least they would be able to see where there money is going every time their road gets plowed.”