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Sandy-cleanup loan forces Village of the Branch tax hike

The cost of cleanup from superstorm Sandy forced the small Village of the Branch to raise taxes 6 percent, Mayor Tom Keon said.

The village board last month unanimously adopted a $980,320 budget for the 2013-14 fiscal year, which increases spending by 31 percent. Keon attributed most of the increase to repayment of a $250,000 loan to cover Sandy-related cleanup.

The 6 percent tax hike triples the 2 percent increase the village was allowed under the state tax cap law. The average home assessed at $5,500 would see its tax bill go up $38.50.

"I don't like it," Keon said. "But it's necessary."

The village of 1,800 residents in the Town of Smithtown occupies part of the downtown business district in Smithtown hamlet. The village's budget year goes from June 1 to May 31.

Keon said the village also was hurt by declining home values, which are set by the town assessor's office. Assessed values in the village dropped about 1 percent, or $51,000, to about $5 million, largely due to successful assessment challenges from village homeowners, he said.

He said he expects the Federal Emergency Management Agency to reimburse the village for up to 75 percent of costs related to Sandy. But he said he does not know when the FEMA money will arrive, and that uncertainty led the village to borrow $250,000. "We had a big storm," Keon said. "That's where most of our problem was . . . Hurricane Sandy."

FEMA reimbursements can take a year or more to process following a storm.

Editor's note: New York State reimbursed the Village of the Branch for cleanup costs from previous storms, but village officials do not know whether the state will reimburse its cleanup costs from superstorm Sandy, Mayor Tom Keon said. A story Thursday mischaracterized the mayor’s comments.

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