Officials: Tax increase cause is ‘sluggish growth’

JOHNSTOWN — Officials say Fulton County’s financial situation — including a proposed average 14 percent property tax rate increase for next year — is impacted by “sluggish growth” in the upstate economy.

All municipalities in the county face county tax rate increases in 2018, most in double digits.

But appropriations are actually down by 5.2 percent from 2017, or about $5 million from the adopted 2017 county budget.

In a printed message released to the Board of Supervisors with the county’s $92.3 million tentative county budget, county Budget Director Alice Kuntzsch said that the tentative budget plan “remains stable.”

Kuntzsch informed supervisors: “Projections for major revenues such as sales tax, mortgage tax and increased property tax base have remained relatively flat for 2018. Consequently, expenses are outpacing revenues.”

Federal and state aid to Fulton County is expected to decrease by 1 percent — or $234,253 — from 2017.

“With the unknowns of new state mandates on the horizon, slow economic growth and unsettled employee contracts, it is time to realign reoccurring revenues with appropriations and decrease the amount of fund balance used to close this year’s gap,” she wrote.

But she said the 2018 budget supports the board’s “commitment to spur economic development in our community.” It includes a $2.3 million investment in capital projects specifically earmarked for development and new land by providing water and wastewater services in key areas.

The board will conduct a budget workshop at 1 p.m. Monday in the Supervisor’s Chambers at the County Office Building. Supervisors will adopt the final budget in late November or December.

“County reserves continue to be a valuable tool,” Kuntzsch said.

But she said state mandates such as Medicaid make up about 70 percent of the county’s tax levy. On top of the 14 percent tax hike, supervisors are also still looking at possibly adding personnel, including: two new sheriff’s positions, one new DSS caseworker, one new information services assistant director, and a new solid waste deputy of operations. Adding those and other reclassifications may add another $335,000 to the 2018 levy.

Mayfield Supervisor Rick Argotsinger, chairman of the board’s Finance Committee, said he wants county Treasurer Terry Blodgett present at Monday’s meeting to explain the county’s fund balance situatuion.

“There is a gap between expenses and our revenues,” Argotsinger said.

He called for lowering the tax rate, but was unsure how much could be reduced.

The tentative budget carries an average 14.4 percent tax rate increase — from a $9.99 per $1,000 of assessed valuation rate for 2017 to $11.43 per $1,000 for 2018. The average tax rate among the two cities and 10 towns would go up by $1.44 per $1,000.

The tax levy would be $31.39 million for 2018 — carrying a 15.3 percent increase in the levy. The state tax cap allows a 3.7 percent increase, but the board would have to make a $3.2 million reduction in the levy to meet the cap. The board already voted this year to allow themselves the option of exceeding the cap for the tax year.

Both the cities of Gloversville and Johnstown currently face 10 percent county tax rate hikes for 2018. Town of Perth residents face a hefty 26 percent tax rate hike, while town of Stratford residents have the lowest rate increase in the county at 4 percent.

Kuntzsch said the 14 percent tax hike actually represents quite a reduction so far this year. Department heads submitted a requested budget the summer that reflected a 42.3 percent county tax levy increase, or $4.22 more per $1,000 of assessed valuation over 2017.

Michael Anich covers Johnstown and Fulton County news. He can be reached at [email protected]

By Patricia Older

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