Larchmont's Proposed Budget Calls For 2.5 Percent Tax Rate Increase

The Village of Larchmont is the latest Westchester municipality to have its budget squeezed by the grip of skyrocketing pension and health costs while contending with the two percent tax cap law that limits the amount of revenue that can be raised by property taxes.

This year’s proposed budget—$21.3 million—calls for a tax rate increase slightly less than 2.5 percent—less than the allowable rate of 4.38 percent—and a 2.6 percent increase in the tax levy. By comparison, last year’s approximately $20 million budget only increased the tax rate by 1.82 percent.

But this year the village was hit with a double whammy in the form of mandated costs: a $260K increase in pension costs and a $167K increase in the cost of health benefits.

“We have two costs that we can do absolutely nothing about increasing $427K in one year for a village of under 6,000 people and one mile square,” said Mayor Anne McAndrews.

Though the village passed a law to permit it to raise taxes over the allowable amount if necessary, the proposed increase does not exceed what’s authorized under the law.

“What’s important for residents to realize is that Denis [village treasurer], along with the trustees, when we worked through the budget, we decided that an increase of that amount was not something that was in the best interest of the village,” said Trustee John Komar, referring to the 4.38 percent increase permitted under the tax cap law.

With approximately 86 percent of the budget eaten up by mandated costs such as pensions, health benefits, debt service and insurance, among other things, village officials don’t have much wiggle room.

“Such a large piece of it is controlled by forces outside our influence….a lot of what we do here is beyond our control,” said Komar.

The public hearing on the budget was adjourned until April 15 at 7:30 p.m.  To view the proposed budget on the village’s website, please click here.