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Proposed Ogdensburg budget paints grim future of tax hikes, service cuts

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On Wednesday, Ogdensburg City Council members got their first look at the preliminary 2013 budget, and they didn’t like what they saw.

The proposal would increase the city’s property tax rate by 10.5 percent, from $16.2113 per $1,000 of assessed value to $17.9140. That correlates with a 10.5 percent increase in the tax levy, to $4,931,106 from $4,459,136 in 2012.

Council members said Thursday the tax increase was unlikely to be approved.

“I think most, if not all, the councilors will agree that 10.5 percent is not acceptable to the taxpayers,” Councilor Wayne L. Ashley said. “It is going to be a tough next four to five weeks before this thing is finalized.”

Councilor Jennifer Stevenson said city residents shouldn’t shoulder the additional tax burden.

“Where we’re looking at a possible 19 percent increase on the county level,” she said. “It doesn’t matter where you get it; people cannot afford a 30 percent increase. On top of all that, we don’t know what the schools’ rate will be. It all means the taxpayer has to write a bigger check.”

The budget also calls for almost $600,000 in additional spending, from $19,040,650 in 2012 to $19,638,757, a 3.1 percent increase. General fund expenditures would increase by a $457,881, a 4 percent change. Spending on community development, water and sewer would see modest increases, while the proposal decreases library spending by 0.2 percent. The Remington Museum’s funding would increase by 5 percent, from $456,601 in 2012 to $479,475 next year.

Most council members acknowledge the city’s problem is not one of spending, but of decline in revenue combined with the burden of higher expenses on state retirement and employee health care. The proposal says Ogdensburg’s retirement contribution increased by 10.4 percent in 2012, but projects a 17 percent increase over the next year, from $1,120,465 to $1,311,543. Health care costs are predicted to increase from $2,500,058 this year to $2,650,267, a 6 percent increase.

“We’re going up $600,000 in expenses,” Ms. Stevenson said. “Retirement, at $191,000, and health care, at over $150,000, account for more than half that increase. That is huge.”

The budget proposal notes the loss of Association of Neighborhood Renewal properties from Ogdensburg’s tax rolls, at a cost of more than $2,000,000. The association’s properties were ruled tax-exempt in a 2009 decision. Ogdensburg has the highest percentage of tax-exempt property value among cities in the state. According to a 2010 report by the state Department of Taxation and Finance, more than 64 percent of Ogdensburg’s total property value is exempt.

Still, the money has to come from somewhere.

“We have aging buildings and aging equipment. We have trucks that need replacing,” Ms. Stevenson said. “Everybody is hurting, but we have to understand that somebody is going to have to pay this bill, and that is the taxpayer. The burden is being put on homeowners. We need to spread that out more fairly.”

Council members are calling for a 1 percent increase in the St. Lawrence County sales tax.

“Where is the money going to come from?” Deputy Mayor Michael D. Morley said. “If anybody is going to point a finger, point a finger at the sales tax,” a figure of much debate around St. Lawrence County this budget season. County legislators have sought legislation permitting the tax increase from state legislators, but have found no support for home rule among the area’s state Senate delegation.

With relief from the state and county unlikely to come this year, council members are left with spending cuts as their only method of bringing the tax rate down.

That may present a challenge as Ogdensburg has operated on a shoestring budget in recent years.

“You can’t cut services or personnel; you just can’t cut people,” Mr. Morley said. “We’ve already cut so much, there isn’t a lot left. We have to look at our Remington and our library contributions, the outside agencies we’re funding.”

The proposal, normally prepared by the city manager, was written by City Comptroller Philip A. Cosmo, who served as interim city manager until John M. Pinkerton’s hiring last month.

Throughout November, Mr. Pinkerton, City Council and department heads will meet to try to trim Ogdensburg’s anorexic budget and reduce the tax increase.

“What we need to do is get the tax increase down to two to three percent,” Mr. Ashley said. “If we have to cut, we have to cut, and I hope each individual department will recognize the situation we are in. It is going to be tough. It is going to be a long and painful process.”

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