Guttenberg voted on the final version of its $15.2 million budget at a special meeting on Jan. 11 after receiving word that they would get $360,000 in state aid.
The amount of the budget that needs to come from taxes is $10.5 million, up $700,000 from last year’s $9.8 million tax levy.
However, the levy’s affect on what each taxpayer will pay depends on how many people are contributing to it, and the assessed value of the property they are paying taxes on. If there are more taxpaying properties in town, then the tax rate will not go up as much for each person because more people are contributing. However, if people have won tax appeals and their property pays less taxes, everyone else will have to contribute more.
Drasheff said that when looking at a 12-month tax period from June 30, 2009 to June 30, 2010, taxes overall, including the municipal, county, and school portions, have risen a little under 6 percent.
‘There’s no magic in this budget. It’s arithmetic.” – Gerald Drasheff
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“This is not an increase that any of us our happy with,” said Drasheff. “It’s a little more than any of us are use to historically in the town, but that’s the kind of function that everyone is struggling with [in the economy].”
He said that these figures could be affected by residents who recently were awarded tax appeals, senior citizen or veterans rebates, or those who receive funds from the Regional Efficiency Aid Program (REAP). REAP is a tax credit given to North Hudson residents because of their fire departments regionalizing.
Drasheff said that while REAP was reduced this year, it was not significant.
Revenues are down
Drasheff said that one of the major struggles for the town of Guttenberg is that revenues have declined.
He said that last year they were able to apply $960,000 of their surplus to offsetting the tax levy, while this year only $820,000 could be put toward tax relief.
“That $140,000 loss of income in revenue has to be made up through the tax bill,” said Drasheff.
He explained that last year the building department earned $127,000 in revenue, while this year only $75,000 was made.
“Drive around any of our towns [in North Hudson] and you’ll realize that people are unfortunately not making investments in their homes,” said Drasheff. “Everyone is waiting to see what happens.”
The Guttenberg Municipal Court had $753,000 in court fines last year, while this year they are projecting only $650,000 in revenue. Chief Financial Officer Vincent Buono said that halfway through the year, the town is a little ahead of their expectations.
Contractual wages of township employees increased by $300,000, said Town Auditor Steven Wielkotz, a registered municipal accountant.
On top of everything, Drasheff said the town was also hurt by health insurance increases and a reduction in Comprehensive Municipal Property Tax Reform Act (COMPTRA) aid.
Nowhere to cut
Drasheff said that everyone on the council was sympathetic to those being affected by the tax hike, but that there really wasn’t any place where the budget could be cut further.
‘There’s no magic in this budget,” said Drasheff. “It’s arithmetic.”
Councilwoman Monica Fundora said that residents often question tax increases because Guttenberg is a small town, but
Wielkotz said that rising costs stemmed from services that residents depend on, such as the Police Department.
“Whoever has been sitting at this table has been pretty fiscally prudent, while being mindful,” said Wielkotz. “This is an exercise that [Drasheff] has been doing since you have been on the council…looking at different properties and seeing what the impact will be and doing the best you can for the taxpayers.”
He said that the budget will help the town move “responsibly” into next year, with funds for public improvements and possible future tax appeals. Even though Guttenberg is feeling the economic downswing, he said that the town has planned better for the future than many other surrounding communities.
Guttenberg was one of 16 municipalities to receive aid, which is normally given to towns that are affected by extreme financial circumstances. In recent years, Guttenberg has deal with tax appeals (which means residents and businesses have won the right to pay less), and falling revenues.
Mayor Gerald Drasheff said that the $360,000 in aid helped offset rising pension costs for town employees. The town was allowed to defer some pension payments in last year’s budget, but must pay $685,560 this year.
The budget, which covers town spending from July 2009 through June 2010, was introduced on Sept. 21.
Tricia Tirella may be reached at TriciaT@hudsonreporter.com.