Long Beach residents face a 6.2 percent tax increase starting June 1 after the city trimmed its originally proposed tax increase by 2 percentage points.
City Council members voted 3-2 to approve the $90.1 million budget Tuesday night after two public hearings, reducing the first budget that would have increased taxes by 8.2 percent.
The increase included a 4.3 percent mandatory hike that adds a $138 tax increase per household. The city must impose the tax for 15 years after a judgment by the New York State Court of Appeals to pay off $18.1 million owed to Sun NLF Ltd., previous owners of the Superblock property between Riverside and Long Beach boulevards along the boardwalk. The city purchased the 263,350-square-foot property in 2006 during eminent domain proceedings for a planned urban renewal project.
The court ruled in September that the city undervalued the oceanfront property by $11 million, and accrued interest. The city has already paid down $2.5 million in escrow payments on the $20.6 million judgment.
“The Superblock litigation is something we’ve inherited over the last 25 years,” City Council president Len Torres said. “It’s still something we have to pay for.”
City Manager Jack Schnirman announced that the council had agreed to cut an initial 3.9 percent operational tax hike in half, down to 1.94 percent. The revised budget lowers a $126 tax increase down to an additional $62 per household.
Council members voted to pierce this year’s 0.12 percent tax cap, but said the 1.94 percent operational tax increase follows the spirit of the state’s tax cap mandate.
City officials were able to trim the first budget proposal by cutting property taxes by $646,000 from the planned 3.9 percent increase by increasing permits and fines, according to the budget.
“Our team worked hard to produce this budget, and I am particularly proud of how we all worked together to fight for our residents,” Councilwoman Anissa Moore said. “There is still more work to be done in the coming months and years, and, together, we will ensure that our budget reflects our priorities and our values.”
Schnirman said the city is working to curb overtime and add savings through attrition and department operations.
He previously said the only way to eliminate the tax increase would be drastic cuts and massive layoffs or to raid the city’s $7 million in reserves. No layoffs are planned in the restructured approved budget.
The city is leaving the position of recreational commissioner vacant, saving a $111,538 salary.
One of the budget-cutting options was to eliminate the city’s paid 13-member fire department, but city council members “did not have an appetite to cut it this year,” Schnirman said.
Passing a budget without tax increases would have resulted in $2.7 million in cuts, Schnirman said.
The five council members are also forgoing a 2.5 percent cost-of-living increase on their $21,559 annual salaries. Schnirman also passed on the 2.5 percent increase on his $173,871 annual salary. It is the second time the administration has declined a pay increase, including in 2012 when the city was emerging from a fiscal emergency.
CORRECTION: An earlier version of this story misstated the vote to approve the budget.