A mix of spending cuts, a modest tax increase and other higher than expected revenue helped Smithtown weather the early months of the pandemic, town officials said after releasing a tentative 2021 budget.
That document, submitted to the town board Monday calls for a 0.81% property tax increase for non-village homes and $107.6 million in spending, up from $104.5 million this year.
Those figures exclude water and ambulance districts that cover only parts of the town; spending including those special districts would rise to $115.6 million from $112.3 million.
Taxes on a typical non-village home assessed at $5,500 would increase to $1,308.52 from $1,298.04, remaining inside the tax levy cap imposed by New York State. A separate waste collection fee assessed to each home would increase from $434 to $485.
Payroll — the town’s largest cost area, accounting for slightly more than a third of all spending — would fall to $34.2 million, down from $34.9 million, as some job positions are left unfilled or departing senior employees are replaced by younger employees who earn less and contribute more to their town-sponsored health insurance.
Town officials’ early fears that the pandemic would wreak fiscal havoc appear not to have been born out. Recreation and marina fees are expected to dip to $758,500 this year but bounce back to $1.2 million in 2021; commercial waste fees, a significant revenue source and indicator of the volume of business activity in the town, are expected to hit $6.8 million, close to pre-pandemic levels. Mortgage tax receipts are expected to hit $5.2 million in a booming Long Island housing market this year before falling to $4.8 million in 2021, slightly off pre-pandemic levels. Revenue for the town's school-age child care program, which topped $1.4 million before falling to an estimated $388,000 in 2020, is expected to rise to $733,000 in 2021. Those shortfalls were costly because the town paid teacher salaries and other regular program costs even as it returned fees for canceled sessions.
As those revenue fell last spring, the town imposed a 15% cut on discretionary spending across most departments, saving about $600,000 by delaying or cutting spending on office supplies and repairs; that spending is reinstated under the draft budget.
"It wasn’t as bad as we anticipated," Wehrheim said. The town does, however, face long-term cost increases in a number of areas. Increasing labor, pension, health insurance and waste management costs "continue to far outpace the increases we are allowed" under the cap, he wrote in a note accompanying the draft budget.
The town’s mandatory contributions to employee pensions are expected to rise to $2.8 million from $2.6 million; its spending on employee health insurance is also expected to increase. The cost of solid waste collection and disposal, a category that includes household garbage and leaf and brush pickup, would increase to $18.5 million from $16.8 million.
That increase is driven in part by a shortage of disposal capacity on Long Island, Wehrheim said. "There are less and less places" to send ash from incinerated garbage at the Huntington Covanta plant, he said. While the town mulches some leaf and brush material and gives it away, it sometimes needs to pay contractors for disposal to stay within state-mandated capacity levels at the two depots where the material is stored.
Transporting waste off Long Island can be complicated and expensive and must — at least for now — be done over area roads.
"This isn't a Town of Smithtown problem — this is the entire region, Suffolk and Nassau and throw in, to boot, Queens," town Comptroller Donald Musgnug said. "We don't have any depots to take it off by water and the rail tracks aren't built out. "
There may be reason for hope on at least one front: Smithtown officials plan heightened enforcement of rules for disposal of oversized tree trunks and branches that residents sometimes leave in the street for municipal workers to haul, Wehrheim said. "What the resident doesn’t understand is it’s costing tax dollars to take that stuff away." Instead, he said, they should be paying contractors to haul the material.
A public hearing on the budget is scheduled for 7 p.m. Oct. 22.