By LOHR McKINSTRY
ELIZABETHTOWN — So far the proposed 2010 Essex County budget carries a 5-percent tax-levy increase.
The levy — which is the amount raised by property taxes — hasn't gone up in six years, but County Manager Daniel Palmer said he believes it is necessary this time.
The levy would rise 5 percent, from $13.2 million to $13.9 million.
"The increase in the levy is being driven by declining revenue," Palmer said. "It's being driven by the economy."
He said appropriations are $2.9 million less than this year, a decline of 3.1 percent, but revenue is down $3.6 million, or 4.9 percent.
A lot of the county's revenue is in sales-tax receipts, Palmer said.
"We projected sales-tax revenue at $22 million, and we were bringing in $24 million. That's no longer the case. We will be lucky to hit the $22.8 million we projected this year."
The budget totals $96.2 million, from $93.2 million currently.
The tax levy was kept to a 5-percent increase by using $7.4 million of the county's end-of-year fund balance, Palmer said.
"Had we not used $7.4 million, the levy would have been over a 25-percent increase."
Supervisor Roby Politi (R-North Elba) said a 5-percent increase isn't out of line.
"I can live with 5 percent," Politi said. "That's my personal opinion."
But Supervisor Thomas Scozzafava (R-Moriah), who chairs the County Finance Committee, said he wants to try to take it below 5 percent.
"Dan has put a lot of time and effort into this budget. I do disagree with a 5-percent increase on the levy. In these economic times I think it's too much."
Scozzafava said supervisors will review the tentative budget at a workshop.
Palmer said there might be ways to reduce the levy, but he wouldn't recommend drawing down the fund balance more.
"You can't keep buying down fund balance. It's unsustainable."
The county will have $13 million left in its fund balance after using $7.4 million to reduce the levy in 2010.
It's not 2010 that worries him, Palmer said, but 2011.
"We completely changed the way we do business in Essex County by opening a new 120-bed jail with a $2.5 million (annual) bond payment and double the staff but did not increase the levy at all. We simply paid for it with fund balance, and that fund balance is going to be depleted by 2011."
He asked that the county appoint a deficit-reduction committee to start work now.
"I think there's time to address it. Based on revenue projections, the 2011 budget represents a significant increase in the tax levy."
There could be a 38-percent tax-levy increase for 2011 even by using another $7.4 million from the fund balance, he said.
Palmer said they're collecting $1.6 million less in county sales tax but are sharing one-quarter percent, or $1.5 million, of their sales-tax revenue with towns and villages for the first time next year. The county has also lost about $1 million in interest income and is generating $600,000 less in mortgage-tax revenue, both due to the weak economy.
In major increases, the county's contribution to the state retirement fund went up $700,000, and health-insurance is up 18 percent, or $1.4 million.
County employees including elected officials will receive 4.25-percent raises in the budget.
The county tax rate next year is projected to be about $2.05 per $1,000 of assessment, from $2.09 this year.
The County Board of Supervisors will hold a budget workshop at 10 a.m. Wednesday . The public hearing on the tentative budget is at 7 p.m. Tuesday, Dec. 1. Both sessions are in the Old County Courthouse in Elizabethtown.
E-mail Lohr McKinstry at: lmckinstry@pressrepublican.com
