ROTTERDAM -- The tentative 2019 Rotterdam town budget predicts spending of $25.3 million -- up just over $1 million from the current year's budget -- and slightly cuts property taxes.
The 2018 budget totaled $24.1 million and increased property taxes about 1 percent. The proposed 2019 budget cuts the general and highway property tax levy by $30,000, from $10,649,994 to $10,619,625, which means there will be a tax cut for homeowners.
"I am pleased, overall, with the budget," said Town Supervisor Steven A. Tommasone, who developed the spending plan. "The biggest challenges we have are maintaining services, and in some cases increasing services, and looking for where we can be cutting expenses, and in areas like benefits, that is difficult to do without affecting the workforce."
Because the town uses a two-tier system in which residential and commercial properties are taxed differently to limit the impact on homeowners, homeowners will see a tax cut, but commercial properties will pay more, because the amount of commercial development in town is increasing.
The general and highway tax rates for homeowners would be set at $3.73 per $1,000 of assessed property value, down from $3.89. That means the bill on a $175,000 house would drop from $680.75 to $652.75. That calculation does not include the special district taxes for sewer, water, fire protection, lighting or drainage that many residents also pay and that are included in the January tax bills.
But the non-homestead rate, which is paid by commercial and industrial properties, will rise from $6.91 to $7.03 per $1,000 -- just under 2 percent -- because those properties are responsible for paying a higher percentage of the tax levy. The system caps how much residential properties pay, a situation Tommasone acknowledged is problematic, and will need to be re-examined at some point in the future.
"That's all a function of assessed valuation, the amount of assessed valuation on the commercial side is increasing, and residential is staying flat, so the homeowners are benefiting," he said. "That's all well and good, but at some point, business owners will say it's too expensive for me to be in Rotterdam, and we have to consider that."
The Town Board will host workshops on the budget this month and tentatively plans to conduct a public hearing on the plan at its Oct. 24 meeting.
To save money, the tentative budget cuts part-time management and clerical positions in the highway and public works departments and the supervisor's office, but Tommasone noted costs are increasing because of 2 percent raises for all town employees, as well as higher medical and dental insurance costs for employees and retirees.
To keep from raising taxes, Tommasone's budget proposes drawing $1.7 million from surplus funds to balance the operating budget. He said the town has a surplus of more than $5 million, primarily because of past savings.
"We are in effect giving that back to the taxpayers, if you will," Tommasone said.
Among new initiatives there is $60,000 proposed to start outside consulting work on a new land use comprehensive plan for the town, which hasn't been significantly updated since about 2001. The plan also sets aside $25,000 in a capital reserve account for future sidewalk construction, which Tommasone said would improve the quality of life for people along Curry Road, Altamont Avenue and along Route 5S in Rotterdam Junction.
Tommasone said the $5 million grant-funded water system improvement project, originally expected to start this year, should start next year, though money for that project doesn't appear in the budget.