Preliminary Red Hook Village budget raises taxes 1.69%

Board trying to keep budget 'lean and mean'

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There is good news for property owners in the Village of Red Hook’s tentative budget for 2014-2015: The projected tax increase is only a nickel more than last year.

The assessed value of the village’s tax base rose from last year’s $189 million to $190.5 million this year. The 2014-2015 tentative budget comes in at $1,839,711, which is an increase of $83,821 over last year’s $1,755,890, while the amount raised by taxes increases $44,065, from last year’s $1,116,257.

The tax increase of 1.69 percent, just above the state’s mandated property tax cap, translates to a cost per thousand of $6.09, up five cents from last year’s $6.04.

“The assessed [tax] base went up a little bit,” Mayor Ed Blundell told the Observer, citing new construction and a rise in real estate sales. “We had been on a downward trend since ’08, but in the last year, it’s come back.”

A public hearing on the tentative budget will be held April 14. The numbers, however, may yet change because the fiscal year isn’t over yet and bills are still coming in. For instance, two of the snow removal lines are over budget, Blundell said.

Growing the village’s fund balance is another potential issue. In a recent state-wide report, the state Comptroller labeled the village susceptible to financial stress and pointed to its low fund balance as part of the problem.

Though Blundell said he is projecting an uptick in revenue in the next year, he said he is also aware that an insufficient fund balance means there is no cushion for emergencies.

“The big question is, should we generate a $30,000 fund balance this year?” Blundell said, noting such a move would increase the tax rate. “The board doesn’t think that’s palatable, but we’ll wind down the fiscal year and take a look at it for the final budget.”

Blundell also said the state budget’s promise of a 2 percent tax refund to those municipalities that stay within the tax cap is problematic because the state’s budget treats the town, the village and the school district as one entity.

What makes it doubly difficult, he added, is that the town and the village’s fiscal years are six months apart and with the cap chained to the Consumer Price Index, the town’s tax cap is 1.66 percent while the village’s has dropped to 1.48 percent.

Though most budget expenses will stay the same, the tentative 2014-15 budget has a few major increases, including a $7,000 rise in pension spending, from $103,000 to $110,000, and a $12,000 jump in health insurance costs, from $120,000 to $132,000. Because of Central Hudson’s recent rate increase, utility costs will go up 10 percent across the board, affecting all departments to the tune of $2,500. Street lighting costs will rise 20 percent, from $50,000 to $60,000.

On the other hand, state Department of Transportation CHIPS income has increased by 28.28 percent, while engineering expenses have plummeted from $13,750 to $4,500 due to the use of grant money for much of the program funded work.

Blundell said the village is expecting $40,000 in additional grants this year; $30,000 for a state clean water study and $10, 000 for a Greenway grant to help with work on village zoning.

“We need to run lean and mean, keep the tax impact low and keep the services coming,” he said.

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