Proposed Westhampton Beach Village Budget Would Increase Taxes by 9 Percent, Piercing State Tax Cap

The Westhampton Beach Village Board is poised to adopt a $14.4 million fiscal year 2025-26 budget that would increase spending by $1.1 million and bump the tax rate up by more than 9 percent — piercing the state cap on tax rate increases.

The board is expected to vote on Mayor Ralph Urban’s proposed spending plan at a Village Board meeting Thursday night, April 3. At a work session meeting last week, a majority of board members said they would support the budget.

It would mark the first time since the tax cap was mandated 14 years ago that the village will pierce it, Urban said, but he felt the village had little recourse.

“The bubble has burst,” he said at the work session meeting on March 27. “I see no choice in piercing the cap. We’ve tried to hold the line on everything except the things we are contractually obligated to pay. We are obligated to pay our employees a living wage.”

At the work session, Urban presented the board with two options: a budget with a 9 percent tax rate increase, or one that would hold the increase to 6 percent by using $350,000 in reserve funds to offset the spending increase.

Board members Kimberly Monsour, Christopher Mensch and Rob Rubio all agreed to the first option, noting that the village should build its reserves rather than use the $350,000 this year. The village utilized a similar $350,000 reserve fund to offset the current year’s budget.

Trustee Brian Tymann was not at the meeting.

Under the proposed budget, spending would increase by about $1.1 million, or 8.35 percent, from the current $13.3 million budget. Revenues are expected to increase slightly, about $140,000 or 5 percent, from $2.7 million to close to $2.9 million. Nonproperty tax revenue would dip close to 7 percent, or $210,000, from $3.083 million to $2.873 million.

The tax levy would jump nearly 13 percent, or $1.319 million, from $10.182 million to $11.501 million. Assessed valuation in the village is expected to increases by about 3 percent from $3.354 billion to $3.462 billion.

All that would result in a tax rate that would jump 9.21 percent, from $3.04 per $1,000 of assessed valuation to $3.32 per $1,000. For a home valued at $1 million, the village property tax would increase about $279.

After thanking the various department heads for their help in crafting the budget, Urban last week offered some bullet points of changes to the budget.

The Building Department budget was down about 4 percent, he said, because of changes in staffing.

The Police Department budget would increase by about 8 percent, from about $3 million to $3.3 million, due primarily to increases in salaries and benefits under a new PBA contract.

Overall, employee benefit costs rose by 15 percent, from $4.068 million to an expected $4.787 million, due to the cost of hospitalization insurance, state retirement program increase and compensated absences.

Urban said he had heard from other villages and municipalities that they are facing similar budget decisions and were also poised to pierce the tax cap.

“We’ve never pierced the cap, ever,” the mayor said, noting that the village has consistently year after year pulled funds from its fund balance to offset skyrocketing mandated costs, but that the fund balance was “getting to a point now” where it would be unwise to keep depleting it.

“It’s important that we maintain it at that stable level,” he said. “For the integrity of the fund — and just in case something happens. I’ve been saying for years that [the tax cap] is unsustainable.

“It’s your decision on which way to go,” Urban told the board last week. “It’s not easy. It’s a difficult balancing act, to be honest.”

Monsour, the deputy mayor, and the other board members agreed that it was better to maintain the reserve at its current level. “I think it’s good to build up the reserves in a comfortable way,” Monsour said. “Nobody wants to say the 9.1 [percent increase] is the way to go, but it’s safer.”

The board will hold a public hearing at Thursday’s meeting on the proposed budget before voting on the spending plan.