Results 1 to 8 of 8

Thread: Tax cap and 2012 Lancaster tentative budget

  1. #1
    Member
    Join Date
    Mar 2008
    Posts
    8,921

    Tax cap and 2012 Lancaster tentative budget

    How did the 2% tax cap affect the 2012 Town of Lancaster tentative budget, you ask? Well, it didn’t. The budget tax levy increase from last year's budget is so small that the 2% tax cap calculations had no impact on the 2012 budget proposed.

    The newly ordained NYS tax cap really is not 2%. The cap is 2% or the CPI, whichever is less. But the cap incorporates exceptions and that can make the tax levy more than 2%. It just so happens that this year’s budget comes in with a tax levy increase of 0.71%, much lower than the 2% cap; only $146,727 over the 2011 budget.

    Under the new 2% tax cap formula, what would the town have been allowed to increase the levy to. What are the allowable exclusions?

    Pensions – The state calculates the average actuarial rate. Every employer has a whole list of options they can adopt. Not everyone’s pension plan is the same. They are not all based on the same basic stuff, like years of service or the final average salary. So, it doesn’t matter what your plan costs, it matters what the average actual actuarial rate increase is.

    The town has police & fire (actually only police) and ERS (Employee Retirement System) plans. The ERS actual actuarial rate increased by 2.6% over last year. Let’s say for example it went from 15% to 17.6% (not actual rate increase numbers). So we are allowed to exclude the portion that exceeds the tax cap limit; 0.6% of our estimated payroll from the cap.

    Example: For the ERS, the average actual actuarial rate increased by 2.6%. The excludable portion is the 0.6%. You take the estimated salaries for 3/13 – because you have to predict not only this coming year’s salaries, but that of 2012. Then the town gets to apply the 0.60% exclusion. The state has done their own projection and provides the town with the salaries through 3/31/13.

    The estimated ERS wages for the Town of Lancaster is $5.39 million. You multiply that by 0.60% and that comes to $32,364.

    The police has the same concept except their average actual actuarial contribution rate increased by 4.2%. Subtract the 2% tax cap and exclude anything over that, which is 2.2%. Police estimated wages through 3/31/13 (projected wages) is $4.23 million. Multiplying $4.2 million by the 2.2%, the town is able to exclude $92,981 from the 2% tax cap limit.

    PILOTS (payments in lieu of taxes) - They are just like taxes but do not show up on the tax bill. Virtually all the town PILOTS are based on tax rates. When one has been granted a PILOT, a percentage of the assessed valuation is what you pay on for a set number f years. If you receive a PILOT, you may pay 50% of the assessed valuation for the first year of the PILOT. It may lower by 5% points per year over ten years – if that is the term limit agreed on. So if your assessment were $1 million, you would pay the going tax rate on one-half million dollars of assessment.

    It is part of the tax levy but does not show up in the levy because the way the levy is calculated is appropriations (estimated expenses) minus the estimated revenues (other than property taxes) and the appropriated fund balance revenue, which leaves the tax levy (amount to be raised by taxes.

    So you take this year’s PILOTS, apply the 2% tax cap and subtract that from next year’s estimated PILOTS. Ridiculous because one has no idea what next year's PILOTS are going to be.

    Not all PILOTS are related to IDA’S. Greenfield is a perfect example. It is not an economic development type thing. Greenfield uses a certain amount of town services – no kids going to school – pay nothing in taxes because they have been exempt; based on religious exemption. Town Assessor Dave Marrano took it upon himself to go to Greenfield and tell them that they should be paying something for using town services. They did pay water and sewer only. Marrano negotiated a deal with them and it is unlike most of the PILOTS where it is not based on assessment. It is a flat fee ($175,000). That windfall will affect our PILOT formula for 2013 budget. You have to add in this year’s PILOTS, subtract out next year’s PILOTS (estimated).

    Tort Orders/Judgments

    You also get to exclude tort actions that exceed 5% of the levy. We don’t have any and in the town’s case the number is zero.

    Bottom Line

    Total exclusions for the 2012 budget = $125,000; $92,961 from police/fire pension system and $32,364 from the ERS pension system.

    Calculating in all the exclusions allowed by the 2% tax cap, the town’s effective tax cap is 2.8%. Simply stated, the town tax levy for this year’s budget could have been increased by 2.8% from last year’s tax levy because of all the aforementioned allowable exclusions.

    People have to understand that the 2% tax cap does not simply mean multiplying last year’s tax levy of $20.64 million by two and declaring that the 2012 tax levy cannot increase by more than $412,853 to $21,055,554.

    The town’s tax cap is 2.8% and that means the tax levy could have been increased by $577,995. The tax levy could have been $20,642,688 (2011 tax levy) + $577,995 = $21,220,683.

    Because the town came in with a tentative budget tax levy (amount to be raised by taxation) of $20,789,415, the tax levy increase in the 2012 budget is only 0.71%, far below the allowable 2.8% increase; a decrease of $433,711 and even far below a 2% tax cap without excludable exceptions.

  2. #2
    Member
    Join Date
    Mar 2007
    Posts
    689
    Lee it looks like you got a lot of information on the budget and sounds like the Board has a no brainer in voting for this budget , But the fact that Mr. Brown worked out a good Budget is this what the Board will stick too? remember this is a election year and the Town employees are almost lock out on getting any monies and they Vote and families vote so it's thin ice that the Board would pass it. Question is when does the BUDGET get vote on By the Board, before the election or not?

  3. #3
    Member
    Join Date
    Jul 2009
    Posts
    6,675
    I believe this had been posted in the past, however I am not certain. My question is if someone has the answer to this; what is the pattern of increases in taxes here in Lancaster. I wondered what the pattern was of increase and did they hold the line only during election years? If we can see a pattern, then it shows predictive behavior on the town boards part.

  4. #4
    Member gorja's Avatar
    Join Date
    Jan 2007
    Location
    Lancaster, NY
    Posts
    13,150
    Quote Originally Posted by shortstuff View Post
    I believe this had been posted in the past, however I am not certain. My question is if someone has the answer to this; what is the pattern of increases in taxes here in Lancaster. I wondered what the pattern was of increase and did they hold the line only during election years? If we can see a pattern, then it shows predictive behavior on the town boards part.
    The last supervisor election year 2007, they approved a tax rate increase of 2.92% for the 2008 budget. The previous year 2006, they approved a tax rate increase of
    .11%. In 2010, they approved a tax rate decrease BUT there was a REVAL that bumped everyone's assessment up.

    Georgia L Schlager

  5. #5
    Member
    Join Date
    Mar 2007
    Posts
    689
    I got a call from the Republicans phone messaging machine on the Dems. budget , and the message was that the Dems. ( Mr. Giza) will use $1,000,000.00 of the surplus in the funds to keep the taxes down due to the elections this year. I need some form of clarification, (1) is this the truth or (2) re-assessment. I don't see signs but I don't vote for B.S. Truth any only the Truth!!!!!!!!!!!! My assessment went up $20,000 and I'm not happy but I have to understand the need to reassessment. BUT to take the funds out of surplus is totally B.S. TRUTH nothing BUT the Truth .

  6. #6
    Member
    Join Date
    Mar 2008
    Posts
    8,921
    Quote Originally Posted by hawkeye View Post
    I got a call from the Republicans phone messaging machine on the Dems. budget , and the message was that the Dems. ( Mr. Giza) will use $1,000,000.00 of the surplus in the funds to keep the taxes down due to the elections this year. I need some form of clarification, (1) is this the truth or (2) re-assessment. I don't see signs but I don't vote for B.S. Truth any only the Truth!!!!!!!!!!!! My assessment went up $20,000 and I'm not happy but I have to understand the need to reassessment. BUT to take the funds out of surplus is totally B.S. TRUTH nothing BUT the Truth .
    The $1 million fund balance use in the budget makeup is not out of character. In truth the fund balance appropriation for 2012 is $963,735.

    In the years listed below, fund balance use (General Fund and Special Districts) was:
    2004 - $1.14 million
    2005 - $1.12 million
    2006 - $992,153
    2007 - $916,186
    2008 – Don’t have a copy of this budget
    2009 - $1.36 million
    2010 - $1.70 million
    2011 - $1.06 million
    2012 - $963,735

    There still remains $4.36 million in the estimated Unreserved Fund Balance.

    What should be the focus is the fact that no town employee salary increases are in the 2012 budget. As we are not privy to the union negotiations we do not know whether the unions will agree to a one year pay freeze.

    We do not know whether the town is asking the unions to contribute to their health care plans. Employees now contribute zero to their health care plans. Should the unions not settle their contracts by year’s end but do settle in the future and are paid retro pay increases, taxpayers will again see a big jump in the tax levy, as happened last year with a 14.7% tax levy increase.

    Since 2004, the year after the police merger appropriations (spending) has increased from $21.48 million to $30.19 million in 2012, a 40.54% increase.

    Revenues have increased from $6.61 million in 2004 to only $8.23 million in 2012, a 24.5% increase.

    The tax levy (amount to be raised by taxation) has increased from $13.66 in 2004 to $20.79 million in 2012, a 52% increase.

    It doesn’t take a rocket scientist to see that taxpayers are experiencing burdening tax increases in a town that boasts of residential and commercial growth.

    This is a feel good election year budget with smoke and mirror unknowns

  7. #7
    Member
    Join Date
    Mar 2007
    Posts
    689
    Thanks Lee I con-da knew that you would have a answer and again the monies come from the cash register in Town Hall the Fund balance (or) the we got you before and you didn't even feel it! Wow Did I like it or not ????????. Still no signs and I will be damn I'm not going to a Rep. fundraiser to get my sign. I 'm voting for ya buy no sign!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

  8. #8
    Member
    Join Date
    Jul 2009
    Posts
    6,675
    Quote Originally Posted by hawkeye View Post
    Thanks Lee I con-da knew that you would have a answer and again the monies come from the cash register in Town Hall the Fund balance (or) the we got you before and you didn't even feel it! Wow Did I like it or not ????????. Still no signs and I will be damn I'm not going to a Rep. fundraiser to get my sign. I 'm voting for ya buy no sign!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
    Hawkeye, do you want a sign?

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. Tentative 2012 Lancaster budget holds the line on taxes
    By Lee Chowaniec in forum Village of Lancaster and Town of Lancaster Politics
    Replies: 8
    Last Post: October 14th, 2011, 07:17 AM
  2. Lancaster 2011 tentative budget available for review
    By Lee Chowaniec in forum Village of Lancaster and Town of Lancaster Politics
    Replies: 14
    Last Post: October 17th, 2010, 11:22 AM
  3. Lancaster 2011 tentative budget available for review
    By speakup in forum Speakup Here
    Replies: 0
    Last Post: October 4th, 2010, 03:11 PM
  4. 2010 tentative Lancaster Budget
    By speakup in forum Village of Lancaster and Town of Lancaster Politics
    Replies: 1
    Last Post: October 8th, 2009, 03:46 PM
  5. Lancaster will hold public hearing on the tentative 2009 budget
    By WNYresident in forum Morning Breakfast - Breaking News
    Replies: 0
    Last Post: October 30th, 2008, 09:30 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •