WPCNR QUILL & EYESHADE. By John F. Bailey. May 16,2012:
The Common Council had their first budget discussion Monday evening and learned that, based on April sales tax revenues, Michael Genito, Commissioner of Finance, has lowered the proposed property tax increase for 2012-13 to 4.75%, from the 5% proposed last month.
WPCNR calculates that the average tax bill for school, city and property taxes on the mid-range $650,000 home will be about $13,500. Of course every home is taxed differently based on its assessed value.
In a related development that will reduces the impact of the 3.03% school tax hike approved by 901 voters Tuesday, WPCNR has learned and confirmed with Geoffrey Gloak, spokesperson for the New York State Department of Taxation and Finance. Mr. Gloak confirmed that the White Plains Basic STAR Exemption will increase to $3,460 (that can deducted off the assessed value of homes of individuals earning less than $500,000 a year)
The Enhanced STAR for those owners of homes over 65 making earning less than $79,000 a year has also gone up to $7,170.
The effect reduces the school tax increase voted last night by $169 for the homeowner eligible for Basic STAR exemption, while keeping property taxes under $14,000 for the average sales price home ($650,000).
For the owner of a $564,000 median-priced home this slashing of the city tax rate by ¼% would result in a tax increase of $112 to approximately $2,360 (up from $2,250 in property taxes paid in 2011-12.
For a $650,000 home, a $128 increase in the city tax means going from approximately $2,700 in 2011-12 to $2,820 in 2012-13. Of course if your home is assessed at more than $650,000 market value you will pay more.
The new Basic Exemption softens the blow of the school district 3.03% increase in the tax rate approved by voters Tuesday.
$13,550 in taxes on the $650,000 home. Keeps Mr. and Mrs. Upper Middle Class Out of the $14,000 Property Tax Zone Barely
The total estimated tax bill in July counting the school budget passed Tuesday would find the $650,000 (averaged sales price home) paying about $8,500 in school taxes (thanks to an increase in the Basic Star Exemption to $3.460 subtracted from your assessment); $2,204 in County Taxes and about $3,000 in city taxes for a total tax bill of $13,550 to $13,700, $900 less than previously projected.
Accounting for the decrease is a lower than expected sewer assessment from the county, the slightly lower city tax increase (4.75%),and the very nice Basic STAR EXEMPTION increase.
Without the Basic STAR Exemption, the school tax on this home be approximately $8,671. This Basic STAR exemption increase, Mr. Gloak said is a result of the calculation of the Tax Levy Cap and is the highest STAR Exemption in five years, reversing a trend..
The Council Decides on the City Tax Monday.
The council is scheduled to vote on the budget next Monday night. It remains to be seen whether White Plains City Commissioners, lauded by Mr. Genito for their frugality and for not being “spendthrifts” will be rewarded for their thriftiness with their first raises since 2010.
Mayor Thomas Roach announced Moody’s, the bond rating service has told the city it has decided to keep the White Plains bond rating at aa1, which the Mayor said was based on the city’s hard decisions the last three years, and the city refusal to borrow for certiorari tax refunds or amortize pension fund increases.
Stabilization Fund to the Rescue. Stabilization Fund to the Rescue.
As first observed by Tim Sheehan of the Budget and Management Committee in April, (exclusively reported by WPCNR), Council President Beth Smayda acknowledged again during the Monday evening 20 minute discussion of the $166.5 Million budget, the council is using the tax stabilization fund on a year-to-year basis to meet the current budget by refusing to touch the stabilization money available from the sales tax increase of two years ago until it is “audited.”
She said:
“The reason we can be under this (tax levy) cap now, without taking drastic measures and getting back to fiscal stability is because we did make a lot of hard decisions two years ago in an effort to get our expenses in line with the reduced revenue base which still has not completely come back, but also in setting up the contingency and tax stabilization fund .
“Since that extra sales tax was approved over two years ago we been able to build up reserves, but also are now in a position where we can appropriate some of those reserves to help us with the budget. It’s a reserve but it’s a recurring reserve. As we followed our fiscal performance goals to not use reserves until they’re audited now we can use a portion of what has been collected on that sales tax (collected as a result of the increase 2 years ago) and that’s helping us tremendously this year to keep our finances stable. If we would have raised the sales tax and spent it (on) that first year’s operating expenses we would be in a much worse position at this point.
So all those things we have done are helping us to stay stable, keep our employees.”
Raises Next?
Should the Common Council decide to break the wage freeze on Commissioners, it could cost the city approximately $500,000. With the transfer of $5,000,000 from the handy Tax Stabilization fund, it is possible to cover a 3% settlement with the police and fire and teamsters if arbitration works out that way and a nice chunk of change for the Commissioners.
The last time raises were voted for the Commissioner team in the former Bradley administration in 2010, it was done in secret after the budget was approved and announced in the dead of night after the meeting. Reporters should be sure to stick around. The holdovers may be due.
Mr. Genito accounted for the reduction in the city tax rate as follows:
Sales tax receipts have been revised upward by $100,000 to about $46,000.
Employee turnover and benefits have reduced $26,000.
Electricity credits for LED lighting changes around the city have received a $50,000 credit from Con Edison.
Miscellaneous revenues have gone up $295.
Overall General Fund revenues have gone up $159,000 from $152.4 Million to $152.5 Million.
Some expenses have been incurred since, Genito said.
$44,000 was added for the city Youth Bureau to continue to support the Excel program which lost its grant with the school district.
$7,500 was lost in revenues from PILOTS by reducing the proposed city tax rate from $184.92 per $1,000 of assessed value to $184.47 per $1,000 of assessed value, up from last years $176.11.
Monday will tell the tale of the money.
To view the entire 19 minute and 46 second discussion on the $166.5 Million budget go to the city website at http://whiteplainsny.swagit.com/play/05152012-796
