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Town of North East taxes up, tax rate down

MILLERTON — The Town of North East Board unanimously approved the Preliminary Budget for 2023 at its last meeting. The details are spread out over 14 pages and are available to the public on the town website and at town hall.

Town Supervisor Christopher Kennan and Lorna Sherman, the bookkeeper who keeps track of the budget for the town, explained the town’s complex budget picture.

The North East property tax burden paid by taxpayers in 2023 rises over 2022 taxes from $2,960,442 to $3,235,281 an increase of 9.3%, in line with the current rate of inflation.

Total projected spending increases to $4,469,501 with the difference between spending and taxes funded by revenues of $448,110 and a 22.5% increase over 2022 in the use of the fund balance.

Where the money goes?

How is the money, roughly $1,500 per resident, being spent? The biggest expenditure, is $1,413,542 including principal and interest payments on equipment, for the highway department which represents 32% of the amount raised by taxes.

Next largest is the cost of the all volunteer North East Fire District which is a separate municipal entity. Fully funded by taxes, the $742,375 expenditure represents 23% of all town property taxes paid.

The ambulance service is the third largest expenditure but rose only 2% to $369,468 this year. Kennan explained that the town, along with Amenia and Dover, are in the third year of a five-year contract with NDP EMS, Northern Dutchess Paramedics.

Given the impact of inflation on fuel and salaries, Kennan is not optimistic about negotiating a better price in two years’ time and expects ambulance costs to rise dramatically in 2026. All town employees and elected officials are receiving a 5% salary increase in 2023. In 2022 when annual inflation is expected to reach 8% by year end, salaries were upped only 4%.

Revenue sources

Revenue generating activities contribute only $448,110 of income to the town’s budget. The largest single sources are sales tax sharing from the county of $113,000, mortgage taxes of $70,000 from the state and $69,300 from the county for highway services. Fines generated by the Millerton Police, the Sheriffs and State troopers are projected to reach only $18,000 of revenue and are more than offset by court costs.

Despite increased spending, town tax rates per $1,000 of assessed value have gone down but taxes have increased. This is caused by the 12% increase across the board in town property assessments to keep all properties assessed at 100% of their market value. Rockethomes.com estimates that housing prices have increased 20.4% since September of 2021 while redfin.com estimated the increase more modestly at 8.9% so a 12% increase falls between those two estimates.

Assessments picture

Assessments are adjusted to reflect market conditions which affects the size of the assessed tax base up and down. In 2022 the town’s tax base was calculated at $598,420,402 which will increase to $673,404,748 next year.

The Preliminary Budget package includes a 2022-2023 comparison of taxes. The bottom line for taxpayers is that anyone who owns property in the town outside the village assessed at $400,000 this year has an assessed value of $448,000 next year and will pay $1,771.50 in town taxes, an increase of $120.48 over 2022. If the property is located within the Village of Millerton, town property taxes on an assessed value of $448,000 will be $895.84, an increase of $46.42. The lower rate within the village excludes the cost of the town highway department and other town-only expenses.

Village property owners

Separately village property owners will pay additional village property taxes. The biggest dollar impact of increased assessments at tax time will not be county, village or town taxes but school taxes. For both town and village residents in the Webutuck School District school taxes in 2023 on the same $448,000 property would be $8,826.

In preparing the budget Kennan stated he recognizes the difficulty that those on fixed incomes have in paying taxes, but also the necessity to maintain a volunteer fire department, build a new highway garage and keep all other operating expenses as low as possible.

At the Town’s regular board meeting on Thursday, Nov. 10, the 2023 budget will be discussed at 7:15 p.m. A link to the preliminary budget document is available on the town website: www.townofnortheastny.gov.

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