BATAVIA, N.Y. — "This particular budget is the consequence of the State of New York and its policies," Batavia Town Supervisor Gregory Post said as he prepared for an emergency town board meeting on Tuesday evening.
The topic is the preliminary town budget for the coming fiscal year, which calls for an 89% hike in the property tax rate.
"We know that no one is going to like or be happy with this budget," town board member Chad Zambitio said.
Financial fears coming to the fore
Local governments have been warning since not long after the start of the COVID-19 pandemic about the impact it would have on their bottom lines.
Now as many begin preparing budgets for next year, they say the realties of direct costs associated with the virus, the impact of state-ordered shutdowns, and a lack of support from New York State are coming to the fore.
"We’re looking at our tax rate going from $2.45 per thousand dollars of assessed value to possibly as high as $4.61 per thousand," said Zambito, who noted that the owner of a typical $150,000 home would see their annual town tax rise from $367 to $691, for an additional annual burden of be $325 per year.
And that's just for the town property taxes.
"You would also have school taxes and county property taxes on top of that," Zambito said.
A trickle-down effect from Albany
"The state’s progressive policies have caused overspending at the state level, with the promise to reimburse counties," Post said. "And they (New York State) are not able to make that commitment this year. They’re out of money."
Due to its own COVID-19 related costs, the state is poised to slash its aid to local municipalities.
In addition, the state ordered shutdown of businesses reduced sales tax collections for counties.
And, because counties are limited in their ability to raise property taxes as a result of Gov. Andrew Cuomo's property tax cap, they have to keep what they can and thus deny town governments their usual cut in sales tax revenue sharing.
"The county has no choice but to reduce the distribution to every town and village in Genesee county because they not allowed to break the tax cap without losing 100 percent of their re-imbursement from the state," Post said.
Local governments feeling the pinch
The proposed reduction in sales tax revenue sharing for this town of nearly 7,000 residents equates to a $1 million shortfall.
And while it certainly isn't unique among local governments in bracing itself for a coming fiscal challenge, Batavia also faces a drop in expected revenue from the Batavia Downs Gaming Center, a state sponsored racino.
"We lost the funding through Batavia Downs which come to us from the state for being host municipality," said Zambito, noting that the Downs was also shut down for several moths by the state during the pandemic.
Hoping for brighter days
Town leaders stress that this is a preliminary budget, and they have until November to adopt a spending plan which they hope won’t necessitate such a draconian rise in taxes. Although Zambito says that some sort of tax increase is almost unavoidable.
"We're hoping for the best, but preparing for the worst," Zambito said. "Things could turn around a little bit and revenue could look a little better ... but if we are looking at worst case scenario, it’s kind of grim right now."
Meanwhile, the town proposes cancelling several projects, to save an additional million dollars in its budget.
Both Zambito and Post believe the state's current financial strife is not solely due to Covid 19 and directly relates to its past spending practices, which left New York facing a $7 billion deficit prior to the pandemic.
"We’re in bad shape here in New York state and I think everyone is going to feel it," Zambito said.