Dobbs Mayor on 2013-14 Budget

Fiscal 2013-2014 Tentative Village Budget

The Fiscal 2013-2014 Tentative Budget has been submitted by the Budget Officer and a presentation was made at this week’s regular meeting of the Board of Trustees on April 9; a Special Public Budget Workshop was also held on April 1 with the Department Heads, the Treasury Department, and the Trustees.  Beyond these public hearings and reports, there is work done on the budget almost every working day of the year.

The Tentative Budget presented recommends a tax levy increase of 1.05%, which if adopted will equate to a tax rate increase of 2.99%.

The levy is the actual amount of dollars to be used to provide services and operate the village for the upcoming fiscal year. The proposed tax rate ($ 228.14 per $1,000 of assessed value) reflects an outstanding job being done by the village’s Administrator, Treasury Department, Department Heads and Staff to find ways to provide services more efficiently. In addition, the strong commitment made 3 years ago to improve the village’s fiscal planning and review process has had a very positive impact on keeping tax rates down in a negative fiscal environment. The combined efforts have helped offset a significant trend of lower tax assessment rolls due to the record high number of certiorari and grievance awards the past several years – this is comparable to a company losing revenues. The village budget has also been negatively impacted by the amount of additional monies the village is required to contribute to rising employee health care costs and the NY State Pension Fund System; these items especially have been a negative push on tax rates for the past 3 years and will continue to be the case into the foreseeable future. The retirement mandates are required of all municipalities to fund the returns which are guaranteed under the state’s public employee contracts.

Impact of Tentative 2013 – 2014 Tax Rate

Below is a TABLE showing the impact of the tentative tax rate on a property owner’s tax bill* (see attached photo for table)


*These are estimates based on Tentative Budget submitted; subject to change depending on Final Budget adopted and/or changes to final Tax Assessment Role.
 
How much is the village tax as a percentage of the total property tax?
 
It is always a good reminder to present a clear picture of how much the village tax is as a portion of the total property taxes paid. The village tax portion is approximately 21% of the total property tax bill that you pay as a resident of Dobbs Ferry. On a percentage basis, your total property tax bill breaks down roughly as follows:
 
Village Tax:                            21%
School District Tax:                  66%
Town Tax:                                 1%
County Tax:                             12%
TOTAL TAX                           100%
 
The following PIE CHART provides a visual perspective showing the property owner’s total tax bill: (see attached photo for chart)
 

Each of the 4 tax entities are managed and overseen separately by different boards. Our responsibility as the Board of Trustees of the Village is to oversee the operations and services that are provided by the Village, and the resulting tax rate based on the cost of delivering those services.

Major impacts on the Tentative Budget 

We will provide more detail on the factors making up the final budget once it is approved, but here are the 2 major items that have the biggest impact:

• Lower assessment roles – The village’s total assessment role (or taxable value) fell again for the 6th consecutive year.  While assessments did not fall as much as the previous 2 years, and the sheer number of grievances awards dropped from the peak, the village has nevertheless suffered a significant loss in property tax revenues since the assessment rolls peaked in 2005. This picture is comparable to a company that is experiencing a continuing loss in revenues. Here is a historical GRAPH of the village’s assessment roles: (see attached photo for the graph)

• Increasing health care costs and mandated contributions to retirement accounts – The costs to provide health care for workers continues to skyrocket. While the village was able to save significant insurance premiums a few years ago by switching its health care provider, those savings have now been realized with the increases over the years since. In addition, all NY municipalities are mandated to make ever increasing contributions to the NY State Pension Fund system in order to support the guaranteed rate of return offered by the state mandated program. Employee benefit costs make up the highest single cost of the village budget – exceeding 35% - and we project them to rise with little-to-no relief for the foreseeable future. Here is a historical BAR GRAPH of the village's annual contribution to worker's retirement and insurance accounts (see attached photo for bar graph).

The Good News … a low increase in the tax rate and a healthy Fund Balance

Along with a relatively low tax rate increase, the village has also been able to maintain a healthy Fund Balance, which is the Village’s reserve savings account. 3 years ago the board adopted a strict Fund Balance Policy; the policy sets-out a simple approach to determine appropriate reserve levels based on the financial condition and results of the village. Since then and going forward, the village does not rely on the Fund Balance to 'balance' the budget or to keep tax rates artificially low; excess levels are directed to reduce long-term debt. A balanced budget is accomplished with good planning and long-term solutions to lower operating costs, and a properly sized reserve account based on the village’s requirements and balance sheet. Here is a historical GRAPH of the village’s Fund Balance, noting the steady and smooth level of reserve funds in balance the past few years. (see attached photo for the graph)


In lieu of the challenging fiscal environment and negative factors outside of the village’s control, tax payers of Dobbs Ferry should feel very good about the hard work and planning being done to successfully keep Dobbs Ferry’s tax rates consistently low. Essential services must be delivered in more efficient ways  to reduce the tax burden and support property values; long term planning has been critical to maintain a healthy balance sheet and reserve funds for a sustainable future. Dobbs Ferry is doing this.

We would like to recognize Village Administrator Marcus Serrano for the work and preparation on the budget, as well Interim Treasurer Patrick Dougherty; also the contributions of the ad hoc Citizens Budget Committee, a group of volunteers working positively with the village to help find ideas that can save the village money. Finally, to all the Department Heads and the Village Staff who are dedicated and work so hard to deliver services to the residents.

Next Steps in the Budget Process

The Public Hearing on the Tentative Budget will be re-opened at the next regular meeting of the BOT on April 23, at which it is expected the board will adopt the Final Fiscal 2013-2014 Village Budget. By law, the Final Budget must be adopted by May 1. The presentation on the tentative budget will be posted on the village’s website and we encourage residents to review this information; and to attend these meetings to observe and learn first-hand about the village’s budget process, and provide input. A Special Newsletter Report will be issued immediately following the adoption of the final fiscal 2013-2014 budget with more details, including specifics on expenditures, revenues, initiatives, and priorities.