LITTLE VALLEY — There’s a little more of a cushion in this year’s 2 percent property tax cap issued last week by state Comptroller Thomas DiNapoli.
Cattaraugus County Administrator Jack Searles, who also serves as budget officer, said on Wednesday the tax cap for the 2018 county budget will use a consumer price index of 1.84 percent.
The 2 percent tax cap is based on 2 percent or the consumer price index (CPI), whichever is less.
Searles said the CPI is only one element of how the tax cap is calculated.
The other three elements are: Appreciation in the value of property, the State Retirement System contribution and payment in lieu of taxes (P.I.L.O.T.) agreements.
“The CPI is a positive element,” Searles said. “We’ll have to see how the others go.”
The State Retirement and P.I.L.O.T. parts of the equation will be known in September, he added. The appreciation in property value should be ready sometime next month.
Last year at this time, the Comptroller’s Office issued a CPI of 0.68 percent, Searles recalled. This year’s is almost three times that amount.
Despite that 0.68 percent CPI, the 2017 tax levy increase of 2.17 percent was within the 2 percent tax cap after adjustments.
The state law, which went into effect in 2012, has reigned in property taxes by restricting the tax levy increase, or the amount to be raised by property taxes.
Cattaraugus County officials are in the initial stages of preparing the 2018 county budget.
The 2017 budget of $228.6 million carries a $54.5 million tax levy, up from $53.4 million in 2016. Each 1 percent of the tax levy is almost $546,000. Total assessed value in 2017 is $3,678,553,762, which is up 3.8 percent over 2015 values.
Searles gives department heads a target based on their 2017 budget and asks them for proposed budgets.
By working backward from how much the levy can be raised, county officials calculate how much departments can increase or decrease their budgets.
“After two years of tax growth being limited to less than one percent, inflation has crept up resulting in the highest allowable levy growth since 2013,” DiNapoli said. “This increase is offset by rising fixed costs and limited budget options. I continue to urge local officials to exercise caution when crafting their spending plans.”
Although the growth factor climbed noticeably from the 0.68 percent cap in the current fiscal year, the 2018 fiscal year will be the fifth year in a row that local governments have had their levy growth capped at less than 2 percent.
By comparison, property tax levy growth for school districts was capped at 1.26 percent for the 2017-18 fiscal year.
(Contact reporter Rick Miller at rmiller@oleantimesherald.com. Follow him on Twitter, @RMillerOTH)