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New Windsor Town Council agrees to hold off on real property tax rate increase for next fiscal year

NEW WINDSOR - New Windsor Town Council members agreed at a special meeting Monday they would pass a general fund budget with no real property tax rate increase for Fiscal Year 2015. Instead, council members decided on waiting for a more accurate picture of the costs of projects they will need to tackle.

Town council members seemed to agree that they would dip into town reserves to start raising money for capital expenses next year. The money will go into the town's FY15 capital budget and will pay for items such as a pavement study and a stormwater management fund, among other things.

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However, other projects, such as road repairs, will not be budgeted for in the FY15 capital budget as council members will wait for more accurate estimates for the costs of the projects.

Town Councilman Kevin Null and Edward Smith were the strongest proponents for waiting to implement a new real property tax rate after next year. In the meantime, council members could educate the public on why a tax increase is necessary, they said.

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"My thought is, let's get through this year. Let's get some input from the community, and then let's make some choices," Null said. "Taxes need to go up, but do they need to go up 10 cents or 15 cents? I don't know."

Smith and Null suggested that a mailing be sent to residents that would lay out the reasons for why a tax increase is necessary, and that a hearing be held next fall for residents to discuss the reasons for a tax increase.

At their council meeting earlier this month, council members had discussed what a nearly 10-cent per $100 of assessed value real property tax rate increase would generate for the town and where it could be used in the FY15 general fund and capital budgets.

Under that proposal, a homeowner with a property worth $200,000 would pay $620 per year rather than $423 per year under the current property tax rate.

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At the meeting earlier this month, the council faced a large deficit in projected expenses and revenues in the general fund budget. However, that deficit had been largely eliminated by Town Manager Frank Schaeffer shifting portions of town's clerk and treasurer's salary and three-fourths of his own salary to the town's projected $874,100 FY15 water and sewer budget, which is paid for through town's enterprise fund. Water and sewer rates rise each year, so the enterprise fund is able to absorb the costs of the salaries.

The change was made at the suggestion of Mayor Neal Roop.

The general fund budget is balanced at $614,550 for FY15.

That left up for discussion a host of capital projects the town will have to fund in the coming years, such as road repairs, stormwater projects and town hall repairs.

Other council members that had indicated previously they wanted start raising property taxes this year appeared to tentatively agree to waiting until after next fiscal year.

Council member Ed Palsgrove said one of the biggest discussions to have is whether residents want incremental increases to the property tax rate or one large rate increase that would pay for most services and projects in years to come.

Most council members seemed to agree with that assessment.

The current real property tax rate is 21.15 cents per $100 of assessed value, which was increased slightly for this fiscal year by council members.

Prior to that, the council last raised the rate in Fiscal Year 2008 from 16 cents per $100 of assessed value to 20 cents per $100 of assessed value.

Residents are also paying higher water and sewer rates each year, largely to pay for an outstanding loan on the town's wastewater treatment plant that became operational in April 2011.

In FY15, the base water rate will rise to $115 per quarter with a user rate of $3.24 per 1,000 gallons.

The base sewer rate will rise to $92 quarterly with $6.62 charged per 1,000 gallons.

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