ROTTERDAM -- The tentative 2020 town budget call for raising property taxes on residential properties about 4 percent on a $25.5 million spending plan.
But Town Supervisor Steven A. Tommasone said that since residential properties saw a tax cut this year, the overall increase from 2018 to 2020 will be about 1 percent. Commercial properties will see a cut next year, after seeing an increase in 2019.
The town uses a two-tier system in which residential and commercial properties are taxed differently to limit the impact on homeowners. This year, though, that means homeowners will see an increase, while business properties will see a decrease. That's due to commercial property values having grown faster than residential values, Tommasone said. Homestead valuations apply to residential properties; non-homestead to commercial properties.
"That homestead is always a challenge for us, because year to year the rates change, based on the percentage of homestead valuation and non-homestead valuation," Tommasone said. "The non-homestead valuation has grown faster."
New commercial development that has added to the commercial tax base includes activity in the Rotterdam Industrial Park, new apartment complexes and commercial activity on Hamburg Street, Tommasone said.
Tommasone said he expects the proposed residential tax increase to be reduced as the Town Board begins going through the budget at workshops this month. But before the tentative budget was proposed, he said he has already reduced department heads' initial requests by about $2 million.
The proposed 2020 budget calls for $10.9 million to be raised from town and highway property taxes, up from $10.6 million this year, an amount that is within the town's tax cap. "The tax cap is a challenge, no question, but what it does is force us to look at our entire operation, rather than looking departmentally," Tommasone said.
Under the budget proposal, the general fund homestead tax rate is expected to rise from $2.32 to $2.45 per $1,000 assessed value, and the non-homestead rate drop from $4.37 to $4.30. The highway rate will rise from $1.41 to $1.44 for homestead properties, and drop from $2.66 to $2.53 for non-homestead properties.
If the proposal is adopted, the town tax bill on a $175,000 house would rise from $653 to $680. 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.
Tommasone's budget proposes drawing $1.7 million from surplus funds to balance the operating budget.
Among proposed new initiatives, there is $100,000 for work on a new land use comprehensive plan for the town, which hasn't been significantly updated since about 2001. Tommasone said he also expects an increase in composting costs, since the town has seen the trucking costs for the material rise.
The supervisor said he also expects there to be work on major water and sewer infrastructure next year, upgrading the water system and extending sewer service on Carmen Road.
"That should bring about additional commercial and residential development to that area over the next few years," Tommasone said.
Tommasone said tentative plans are for a public hearing on the budget at the Oct. 23 Town Board meeting, with a vote at the Nov. 13 meeting.