Though the Town of Mamaroneck was able to avert overriding the two percent tax cap last year in the wake of state mandated costs, dwindling revenue and a down economy, it seems like an unlikely proposition for the future.
“I have to say, keeping the services that we enjoy in the Town of Mamaroneck, it is not possible to stay within the cap year after year and I don’t think it’s possible this year,” said Town Supervisor Nancy Seligson.
The $22.4 million preliminary budget for 2013 is $1.06 million—or almost 5 percent—higher than the $21.3 budget that passed in 2011. By comparison, the 2012 budget increased the tax levy by $589K from 2011, a percentage within the range that the town was permitted without overriding the cap.
If the budget is passed by the board on Dec. 19, a taxpayer with an average assessed home valued at $20K in the unincorporated area of Mamaroneck will pay an additional $254 in property taxes; those in the Villages of Larchmont and Mamaroneck will be looking at an $83 annual increase.
Last year’s budget was achieved, in part, by two employees who took retirement incentives, shaving $110K off the final numbers, as well as more favorable deductions in the tax levy formula that would have allowed the town to raise the levy by as much as 3.23 percent without overriding the cap.
However, this year the state has reduced the amount by which municipalities may exclude their pension contribution from the tax cap levy formula, which amounts to an approximately $98K drop, from $162,362 to $63,992. Also, the state has decreased the growth factor accounting for inflationary change, another factor in the formula that further decreases the amount by which the town can raise the levy.
Additionally, the town was faced with state-mandated increases in health insurance and pension costs equal to 87 percent—or $468K—of the allowable increase for the town under the cap.
Employee salaries and benefits, at $21.18 million, make up an overwhelming portion of the preliminary budget; last year these costs amounted to $20.3 million of the budget.
The town has opted to put $570K back into their surplus funds in order to achieve a 15-20 percent balance with appropriations. Surplus has declined in recent years due to poor performance on investments and low revenue.
“We need the surplus in the event of an emergency and to maintain our AAA credit rating,” said Seligson, referring to the town’s ability to borrow money at very low rates of interest.
Officials were also steadfast in their belief that borrowed funds should not pay for built-in budgetary costs like healthcare and benefits.
“I think borrowing for a pension is like taking out a mortgage to buy your groceries,” said Town Administrator Steve Altieri.
Offsetting some of the increases in mandated budget costs was a little over 6 percent—or $572K—increase in non-tax revenue from the previous year including sales tax, ambulance charges and building permit, recreation and parking fees.
Some of the cost-cutting measures the town has proposed for 2013 include an energy use reduction; retirement incentive plans to be offered to senior employees; no additional full-time positions and a series of negotiations that are currently taking place with both the Civil Service Employee’s Association (CSEA) and career firefighters’ unions.
Other future measures could include reducing garbage pick-up days, modifying leaf pick-up and charging fees for sewer usage.
The board unanimously approved a local law to override the tax cap levy.
The preliminary budget can be viewed in full by visiting the town's website.
The Board of Trustees will vote to pass the budget at a Dec. 19 meeting at 8 p.m.