BROADALBIN -- In a bid to eliminate budget deficits and rebuild the town's reserve funds, the Town Board has adopted its $2.1 million 2019 budget with a 177-percent tax rate increase.
The rate increase is broken into two parts: the town's 2018 tax rate per thousand dollars of assessed value is hiked from 90 cents to $1.30 per thousand and a town highway tax of $1.20 per thousand is assessed on town land outside of the village of Broadalbin — creating a combined tax rate of $2.50 per thousand.
The New York state state tax cap for 2019 allows approximately a 2 percent tax levy increase. Broadalbin's 2019 budget increases the town tax levy 11.1 percent, increasing it from $304,328 to $337,996. The budget also raises $339,500 from the new town highway tax, which had previously not existed.
The 2019 budget increases general fund spending $36,020 from $640,550 to $676,530, and also establishes a general fund reserve account and puts $120,101 into it.
In a news release explaining the town's difficult fiscal position, Town Supervisor Sheila Perry said when she and Town Board members David Bogardus and Douglas Kissing were elected to the board they faced deficits caused by the exhaustion of the town's reserve funds over previous years.
"When preparing the 2018 budget in the fall of 2017, the previous Town Board faced a $266,000 deficit in the highway fund, and a shortfall of $98,000 in the general fund overall. Still, the budget was adopted, unbalanced -- with insufficient revenues to pay the projected expenses of this year we are now completing," she said.
Perry said the decision by past town officials to keep the tax rate between 2006 and 2018 at close to 90 cents per thousand has resulted in a highway fund deficit of $273,000 and a general fund deficit of $109,000. She said the lack of tax revenue also caused the town to neglect its truck replacement program for its Highway Department and its road repavement program.
Perry said one of the goals of the tax increase is restoring the town's reserve accounts.
"Restoring those reserves is crucial to the rating of this town and its ability to borrow. Therefore, 10 cents of the proposed tax rate in the general fund, and 10 cents of the proposed tax rate in the highway fund will be set aside in their respective reserve accounts. It has been projected that it will take the next eight to 10 years to restore those reserves to acceptable levels," she said.