Town finance Commissioner Tamara Wright has projected that first quarter mortgage tax receipts will total $8.9 million, short of the $10 million that was calculated in the budget. That comes on top of a $500,000 budget shortfall in mortgage tax from 2011.
A recovery later this year is unlikely, she said at a Thursday work session.
"We might be at a new normal," Wright said.
With declining revenue, Town Supervisor Mark Lesko warned that service cuts may be coming. "The problem we face is, we have essentially kept services intact," he said. "That's going to change."
The landfill has been a vital source of income for Brookhaven, generating $45 million a year. Lesko recently proposed expanding the landfill -- to both extend its life and generate millions in additional revenue. Neighbors opposed to an expansion say the dump is smelly and coats properties with ash and dust.
At the work session, Jeff Kassner, town director of environmental protection, presented a formal proposal to increase the landfill's height by 50 feet, making it 320 feet high and capable of holding an additional 3.9 million cubic yards of waste.
Representatives from the Brookhaven Community Coalition, which opposes the move, offered alternatives, such as imposing a $20-a-year townwide landfill fee and opening satellite landfills.
"We need you guys to help us out," said coalition member Wayne Losee.
"We want you to balance the budget, but not add to the burden," said another member, Adrienne Esposito.
Town board members questioned the feasibility of the proposed alternatives.
"Why would you, as an environmentalist, put five other landfills in other districts?" asked Councilman Dan Panico.
But Councilwoman Connie Kepert, who represents Yaphank, said the town needs to find ways to help residents affected by the landfill.
"The problem is this is enormously unfair to the people living around the landfill," she said, urging the board to consider accelerated intake as a reasonable compromise.
The board is expected to vote on the landfill expansion at Tuesday's meeting.