Published: November 05, 2009 09:58 pm      

TOWN OF TONAWANDA: Budget passes with 1.5 percent tax hike

Taxes in the Town of Tonawanda are going up 1.5 percent for homeowners next year, but one speaker at Thursday’s public hearing was more concerned about the budget’s effect on local business.

Supervisor Anthony Caruana said the increase is half of what was being proposed before the town board got a hold of the budget and the lowest increase year to year since 2002. Reductions by the board totaling $380,000 came from utility, fuel, equipment, tote repair, hospital and medical insurance accounts.

Despite the cuts, the cost of government continues to trend upward. This year’s biggest increases came from the rising costs of hospital and medical insurance, wage increases for town employees and other related fringe benefits including retirement and worker’s compensation insurance. Insurance accounts for more than 13 percent of the $88.5 million budget.

Caruana heralded the town’s efforts at trimming costs to keep the tax increase manageable, but Kenmore resident John Drexelius said the supervisor’s comments left out the impact on local business. To fund the 2010 budget, homeowners pay $6.41 per $1,000 of assessed property value. A business pays $12.94 per $1,000, which Drexelius said is unconscionable. Certain businesses, like utilities, aren’t able to leave because their market is local, but Drexelius said other types of companies could depart.

“The manufacturing base can and will leave the town if the board continues to excessively tax their facilities,” Drexelius said.

Councilman Joe Emminger said the town board in 1986 was to blame for splitting town property into homestead and non-homestead categories that resulted in the present disparity. He added that the town has set money aside in an effort to alleviate the burden on businesses, but that the process is slow going.

“This town board is playing the hand it was dealt by previous town boards,” Emminger said.

In his remarks, Drexelius said he believes the town should shift more of the tax burden onto the homeowners, but Emminger rejected that idea because it would mean a 20 to 30 percent spike in the homestead tax rate. A 5 percent across-the-board cut in town departments was another of Drexelius’ recommendations for closing the gap.

“This board needs to make the difficult choices you were elected to make,” Drexelius said.

In response, Emminger asked Drexelius if that meant he was recommending cutting staff in the police department, among others. Drexelius dodged that question by saying there were other ways to make cuts. In the end, the board voted to approve the budget as it was, with only the initial cuts made by the town board. Caruana said he’s confident the budget still provides enough resources to maintain the town’s high quality of municipal services while not overburdening the taxpayers. While the supervisor pointed to unfunded mandates from the state as a problem for the future, he also touted the fact that the town did not include anticipated grant awards in its revenue planning.

“I believe in these very difficult economic times we’re going through, the town is on track to meet these challenges head on,” Caruana said.

Contact reporter Daniel Pye at 693-1000, ext. 158.