Glen Cove Mayor Timothy Tenke has called a special city council meeting for Tuesday to vote on granting the city the authority to raise taxes above the state-imposed cap — but said if he’s able to balance the budget before then, he may cancel the vote.
Residents and City Council members criticized the mayor during this week's council meeting for planning to pierce the tax cap and saying the city may need to lay off employees unless the council approves an override of the state tax levy cap, which is set at 1.8 percent tax for 2019.
Tenke said a 4.12-percent increase could be needed to plug "a $5.3 million hole in the budget," which is still not complete.
Former City Councilman Steve Gonzalez accused Tenke of using the specter of layoffs to pressure council members into backing the override.
Layoffs would only be “a last resort,” Tenke said.
Councilmembers have asked Tenke to spend more of a predicted $2.7 million surplus to plug the budget hole. The mayor has proposed spending $2 million but leaving $700,000 as a reserve.
“If he uses 2.5 [million] or 2.6 instead of 2, then the layoffs can be averted,” Councilman Joseph Capobianco said.
Tenke said it would be “irresponsible” to leave the city with almost no reserves. But he said in an interview Wednesday that he is now resigned to likely having to dig deeper into the surplus.
“I see where the council is going with this,” Tenke said. “My feeling at this point is they’re not going to approve a piercing of the tax cap. So I have to prepare for that eventuality and be realistic.”
Councilwoman Marsha Silverman said Tenke should look for additional budget cuts rather than reduce the surplus. The mayor has announced $2.8 million in cuts, but Silverman said “the budget is not bare bones. ... We can do better.”
Tenke has blamed the budget problems on a big drop in “one-shot revenue,” including the millions of dollars in land purchase and building-permit fees in the past few years from the Garvies Point waterfront development.
The project's developer, RXR Glen Isle Partners, is to make its first payment in lieu of taxes to the city next year: $470,170. That amount gradually rises to more than $9.2 million in 2056, after which RXR begins paying full taxes. The relatively small payments the city will receive in the early years was one of the chief criticisms of the nearly $200 million in tax breaks for the project.
Resident Dave Nieri said he was incredulous at how little revenue the city will receive from the $960 million project in 2019.
"We just gave away the store," Nieri said.
Tuesday’s meeting begins at 6 p.m. in the second-floor conference room at City Hall.
To pierce or not to pierce
New York State imposes a ceiling on how much municipalities can raise the property tax levy each year. For Glen Cove, the limit is a 1.8 percent increase in 2019, said city Controller Sandra Clarson. The City Council can pierce that cap by voting in advance its intention to do so. The council can then at a separate meeting approve a tax increase above the cap. The cap was first imposed for local governments in 2012. Glen Cove has never raised taxes beyond the cap, officials said.