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Government & Politics

Sleepy Hollow Exceeds Cap Rule: Villages’ Tentative Budgets Vary With Adhering to Tax Cap

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April 1, 2015

|  by Robert Kimmel  |  

Tentative budgets prepared by the financial officers and administrators of Irvington, and Tarrytown, will fall within the state’s tax freeze  requirements, making it likely that many homeowners will receive small tax rebate  checks later this year.  However, Sleepy Hollow’s tentative budget places that village over the tax levy cap, Albany’s incentive to have local municipalities hold down tax hikes, which has played an important role in budget planning for the 2015-16 fiscal year.

The checks received from New York State would be equal to the tax increase set for each homeowner as required by village budgets that keep tax rate increases below the cap.

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In order to get the tax credit, the villages must also develop a Government Efficiency Plan that projects savings of at least one percent for the following three years. The plans, which should include the sharing of services or consolidated projects with other municipalities or school districts, are being developed by all three villages. They must be presented to the State’s Division of the Budget by June 1 and then approved by that body.

Sleepy Hollow homeowners will probably experience the unusual; a decrease in their tax rate. “The tax rate is going to go down, because assessables have gone up significantly, thanks mostly to the sale of the General Motors property,” Village Administrator Anthony Giaccio said. That sale returned approximately $700,000 to the village’s assessable property tax total. While the tax rate drops the tax levy, the proposed budget will increase by about $1.6 million to nearly $12 million in collected taxes, which represents 67% of village revenues.

Despite the assessable increase, Sleepy Hollow homeowners, in one to three family homes, will likely not receive the tax rebate check this year if the tentative budget is maintained, because it exceeds the complicated tax cap freeze requirements. Potential rebates would not have applied to commercial properties, which represent a smaller part of the village’s assessable totals. To qualify for a rebate, as part of the state’s two-year tax relief program, a property must fall within the Star Tax Exemption; it must be the homeowner’s primary residence, and total household income can be no more than $500,000.

The tax rate for 2015/16 in Sleepy Hollow was tentatively set at $34.28 per thousand dollars of a property’s assessment value, which is usually a small percentage of the actual market value of a home, set by each taxing jurisdiction. That rate represents a reversal of an upward trend annually over the past nine years. Non-Homestead properties, however, may see a rate nearly double that number.

Mayor Ken Wray wrote in a message to residents that the budget maintains his “…focus on four areas: property tax relief, ensuring that Village staffing needs are properly being met, beginning a comprehensive master plan, and enhancing programs for our seniors. I added full time positions in Public Works, the Police Department and in Village Hall; $100,000 in funding for the initial phase of the master plan; and funding for senior programs has been doubled.” The Mayor urged residents to
“…attend Board meetings on April 7 and April 14, so that the Board of Trustees and I will have your input as we work to adopt this budget.”

Tarrytown faces a situation opposite to that of Sleepy Hollow in that its tax assessable property total has dropped, mainly because of two factors, according to the Village Administrator and Budget Officer Mike Blau. In a message to the Mayor and Trustees accompanying his budget, he noted that the decrease was “…due to tax certioraris and the granting of a partial tax exemption to a property that had been fully taxable in 2014-15.” The South Broadway property he referenced was purchased by Montefiore Medical Center, which is tax exempt, from  Kraft Foods, which is not. Kraft has rented back part of the property, but the tax exempt portion represents about a third of the $2.2 million Tarrytown has lost in taxable property for the coming fiscal year.

“In order to be where we are in a new budget, we had to generate an additional $653,000,” Blau said. “Recouping this loss of tax dollars in the tentative budget increases the tax rate by 4.48 % but has no effect on the tax levy,” he continued.” Tarrytown could have increased the amount of tax levy it is collecting by $464,800 and remained within the cap; however, the increase amounts to $194,157.”

The proposed tax rate is $312.94 per thousand of assessed value as compared to the current rate of $295.77. The average assessed value of houses in Tarrytown is about $15,000.

Village Treasurer James Hart, who partnered with Blau in developing the budget, put it succinctly, “…a large part of the increase in the tax rate is due to the loss of assessables, not expenses.” However, Blau noted an increase in the cost of health insurance as part of employee benefits, and added that the budget does call for one additional person for maintenance work in the parks and recreational facilities which are expanding. An increase of $25 for parking permits is included in the tentative budget to make up for some of the revenue loss.

The Board of Trustees can modify the tentative budget, and a public hearing on it will be set before April 15. Village Budgets must be approved by May 1.

Irvington’s Board of Trustees will hold a public hearing on its 2015-16 tentative budget on Monday, April 6, at which time it will also consider proposed water rate changes, as announced by its Clerk Treasurer, Brenda Jeselnik.  That village’s proposed tax rate of $294.61 per thousand dollars of the assessed value of a home represents an increase of 2.45% over the tax rate set last year.

Administrator Lawrence Schopfer indicated that, the Village has a small growth in property tax assessables over last year, and that its tax levy would remain under the cap set by New York State, based on the preliminary budget.

The village would be collecting $13,519,493, a hike of about $413,000 over the prior year’s tax revenues, but under the permitted tax cap amount by approximately $164,000. Some of the more hefty increases in its budget related to medical and health insurance.

All three villages are collaborating on the installation of LED street lighting to replace the current systems as part of their Government Efficiency Plans. Blau anticipated a large savings in the projected budgets from LED lighting, as did Schopfer and Anthony Giaccio, Sleepy Hollow’s Administrator.  Giaccio also noted the collaboration among the villages in the Pothole Killer Pilot program, and indicated Sleepy Hollow was looking at the potential sharing of a snow melting device, which he stated could result in “big savings.” The Village, he added, was also looking toward an energy audit shortly and the installation of automated water meters to check leakage.

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