The Village of Rhinebeck intends to override the state-imposed 2 percent property tax cap for next year’s budget, because of the new police station, according to Mayor Jim Reardon.
Although the exact increase to the tax levy is unknown, Reardon told The Observer he was sure it would exceed the cap.
The village has set a public hearing for April 12 at 7pm at Town Hall to discuss the tax cap override, as mandated by state law.
Reardon said he hoped to finalize the 2013-2014 budget by April 8 and post it on the village’s website shortly before the hearing.
Recognizing the tax cap would need to be exceeded, Reardon said he “charged the board with being cost-efficient” in areas other than the police station bond when putting together the budget.
Most of the increase from last year’s budget can be attributed to the development and building of the new police station, which Reardon said has been bonded out in payments of approximately $60,000 annually for a 20-year duration.
Last month, Reardon said the tax increase for residents on just the bond alone could be 4 percent, but this time he refused to give specific numbers.
Although the village got an interest rate of 2.99 percent on the project—much lower than the 4.5 to 5 percent its bond counsel had forecast—the initial cost of the building will force the village to exceed the cap, while trying to keep appropriations for other budget items relatively flat, he added.
The station is being constructed behind the firehouse after the former station, on the Dutchess County Fairgrounds, became unsafe, Reardon said.
“Was there going to be an impact to the taxpayer? No doubt. We knew that,” Reardon said.
Last year, village residents paid 2.55 percent of the 2012-2013 budget for the bond used to purchase the new station property.
If it were not for the police department’s new building, Reardon said the village would more than likely be able to stay under the cap.
But the police department is not the only area in which the village will see a spike in costs, he added.
Much like many other municipalities across the state, Rhinebeck is facing what has become yearly increases in employee retirement costs.
“We’re continually seeing all of these mandates,” Reardon said.
Some increases in employee costs are simply due to previously negotiated labor contracts by the village and its employees, Reardon said. But many others are costs fixed by the state.
One example of a state mandate that will cost the village this year, Reardon said, is new equipment for the fire department. The volunteer firefighters require what is called “bailout gear,” which allows them to rappel from a tall building. The cost of the equipment will be approximately $18,000.
The village will also need to purchase other necessities for the department, such as pants and coats.
Most other expenses, Reardon said, will remain relatively flat.
It is unclear at this point whether the village’s tentative proposal earlier this year to scrap trash pickup is still a possibility for budget purposes.