North Haven Might Be Forced To Pierce Spending Cap

North Haven Village sign

North Haven Village taxpayers, who have seen their village tax rate decline the past three years because of ever increasing revenues and a growing tax base, might see that streak come to an end this year.

The village board on Monday took its first look at a preliminary $1,630,283 budget for the 2018-19 fiscal year that would increase spending by 8.4 percent. Whether the tax rate will decline once again, stay the same or rise by as much as 25 percent, depends on just how much money from its surplus accounts the board earmarks to offset the need for tax revenue in this year’s budget.

The good news is the current tax rate is just $0.505 per $1,000 of assessed valuation, which means the owner of a house valued at $1 million pays just over $500 in village taxes.

Village treasurer Eileen Tuohy told the board to stay under the state-mandated tax cap, the village can raise a maximum of $943,355 from property taxes this year. That means it will have to make up the balance of the budget through other revenues or by dipping into its $1,162,118 surplus fund.

If the village were to use $263,136 from surplus to balance the budget, the tax rate would decline by about 2.3 percent and the village would not be required to pierce the tax cap, Ms. Tuohy told the board. She presented three other scenarios that would require the village to pierce the tax cap: If it used $241,250 from surplus, the tax rate would remain the same, but the village would be required to pierce the cap by raise raising more from taxes. If it used $200,000 in surplus, taxes would go up by an estimated 4.3 percent. If it chose not to dip into its surplus account at all, the tax rate would jump by 25 percent.

The budget contains an estimated $126,925 in spending increases. Most of that, or $98,220, would come from an estimated increase in the cost of the district’s contract for fire protection with Sag Harbor Village.

Ms. Tuohy has also estimated that the village will see its nontax revenues fall by about $50,000 this year as applications for building permits fall off.

That prompted board member David Saskas, who is a surveyor, to ask if the village could tighten its practices for issuing building permits. Currently, the village issues permits for 18 months. Typically, it requires that builders who do not complete their projects in that time to pay for extensions that are prorated based on the percentage of work that needs to be completed. Mr. Saskas said in East Hampton Town and Village building permits are issued for one year, and if a project is not completed, builders must pay the original fee to renew their permits.

The board took no action but said it would hold a second budget meeting on March 26 at 5 p.m.