PLATTSBURGH — As local governments get set to prepare their 2012 budgets, which will now include a 2-percent property-tax cap, they appear to have more questions than answers.
"That's why we are here today. We want to know what the rules of the tax cap are," Town of Plattsburgh Supervisor Bernie Bassett said.
"If the rules are fuzzy, it makes it harder to deal with."
Bassett was among about 200 government and school district leaders from throughout the North Country who attended Thursday's Local Government Leadership Institute at Plattsburgh State.
The forum was designed to provide information on pressing issues, including the newly implemented tax cap.
Many North Country municipal leaders have expressed deep concern that a tax cap without meaningful mandate relief from Albany could be a major hindrance for local government.
City of Plattsburgh Councilor James Calnon (I-Ward 4), who as mayor pro tem serves as the city's budget officer, explained that the cap will allow the city to raise only an additional $186,000 in taxes. Yet, the projected increase in the state's employee retirement pension plan for the city would be about $177,000.
"That only leaves us with $9,000 to work with. That's not much," Calnon said.
State Comptroller Thomas DiNapoli, who delivered the keynote address at Thursday's forum, said his office will do its best to help local governments deal with the cap.
"The only way to get through these tough times is to work together," DiNapoli said.
"The best advantage you have is yourselves. You are all spirited, hard-working New Yorkers."
EXCEEDING PENSION COST
Pension costs for municipalities are based on the performance of the investment market over a five-year period. Because 2008 and 2009 — very poor investment years — are included in the latest five-year cycle, municipalities will see significant increases in pension payments for 2012.
DiNapoli explained that municipalities will be allowed to exceed the 2-percent cap to pay for a portion of the pension increases.
"But it will still put more stress on governments," he said.
Another option for local governments is to amortize the pension increases over time.
North Country Congressman Bill Owens (D-Plattsburgh), who also participated in the forum, said he believes it will take a few years for the true impact of the cap to take effect.
"But clearly it is a step in the right direction," Owens said.
"But there does need to be some mandate relief."
DiNapoli said he hopes the state task force assigned to come up with mandate-relief recommendations is successful.
"You really do need to give local officials some life lines to work with," he said.
Local officials have warned that because of the cap they will have to make serious cuts to services and programs or operate in a deficit.
Governments can opt to exceed the cap, but it must be approved by a 60-percent majority of the board or council. School districts can do the same, but it has to be approved by at least 60 percent of the voters.
"I think this will play out differently in every county," DiNapoli said.
"But they will be faced with some very tough choices."
Email Joe LoTemplio at: firstname.lastname@example.org