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Philadelphia dries up fund balance to reduce tax levy in budget

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PHILADELPHIA — Due to a steep drop in the total assessed property value last year, the village will spend most of its fund balance to reduce the tax levy in the 2013-14 budget, which the Board of Trustees approved Monday.

In 2012, the village’s total property assessment plummeted after the 150-unit Friends Settlement apartment complex challenged its $15.5 million property assessment and won, lowering the property’s assessed value to $8.5 million and reducing the village tax roll.

Also last year, the assessed value of 367 residential properties in the village was increased by 24.5 percent, based on a three-year sales analysis conducted by Town Assessor John C. Kiechle. That study factored in the sale of 100 houses in the village from 2008 to 2011 and found that the properties were being sold at prices well above their assessed value due to their high demand.

The 24.5 percent assessment increase — which affected only residential parcels — was approved by the state Office of Real Property Tax Services last year; apartment complexes and commercial property were not affected.

Mr. Kiechle, who last conducted a revaluation of village and town parcels in 2008, said that higher residential assessments in the village are due to military families’ need for housing.

“There is now a big demand for housing at Fort Drum, and single-family houses is where the sales are,” he said.

Those higher residential assessments helped the village make up for some of the $7 million lost on its tax roll from the Friends Settlement case. Higher property taxes paid by residents made it important for Mayor Matthew J. Montroy to avoid increasing the tax rate for residents this year; it will remain the same at $5.50 per $1,000 of assessed value.

The tax levy by the village will be 6 percent down from this year, though, falling $15,774 from $250,994 to $235,250. To make up that deficit, the village shifted $172,000 of the $200,000 left in its general fund this fiscal year to pass a balanced budget.

“Anybody whose assessment went up are already having to pay more taxes and people are hurting because it’s a bad fiscal time,” Mr. Montroy said. “But I like to think that everything we’re doing here will help draw more business to help alleviate some of this pressure in the future.”

The village expects to save $3,594 on health care coverage in the budget by changing its provider from the state Insurance Program’s Empire Plan to Excellus Health Care. The plan will provide coverage for five full-time employees, decreasing expenses from $14,106 this year to $10,512.

The village’s total spending plan is $1,927,143, down 9 percent from this year’s $2,108,393. The fiscal year starts June 1.

Another reason for tightening spending, Mr. Montroy said, is that the residential sewer rate climbed last year from $55 to $60 per quarter, and could climb again. That extra revenue will help pay off the first phase of a multi-year capital project to upgrade the village’s wastewater collection and sewage treatment plant.

Contracts have been awarded to complete the $4 million first phase, to be completed from May through June 2014. Work will include the replacement of sewer lines on Irish Avenue and Sand Street, the installation of three sewer lift stations and replacement of power lines obstructing the area near the treatment plant, located on Garden Road bordering the Indian River.

That work will be paid off partly by a $2 million grant from the state Environmental Facilities Corp., while the remainder will be paid for by increased residential sewer charges over the next three decades.

The project is the first portion of a long-term engineering plan designed by Bernier, Carr & Associates of Watertown to build a new sewage treatment plant, replacing the old one for phase two. Building that plant will cost the village an additional $4 million.

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