Calling the state tax cap "totally unrealistic," Mayor Rick Davis unveiled a 2018 budget Tuesday that would raise property taxes in the City of Tonawanda by 4.99 percent.
That would be more than two and a half times the state tax cap.
The tentative budget of $22.32 million proposes a tax rate of $18.63 per $1,000 of assessed valuation, up from the current rate of $17.74 per $1,000, or a total of $89 per year for an average city home assessed at $100,000.
The proposed sewer rate is projected to increase 2.7 percent, from $5.60 to $5.75 per 1,000 gallons -- or about $6 per year for an average home.
Taxes pay for 53 percent of the budget and to stay under the cap would require a huge reduction in city services, Davis said.
The city has been unable to stay under the cap for the past three years. Last week, the Common Council narrowly approved a measure that would allow the budget to go over the cap again in 2018.
Councilman Chuck Gilbert said last week that unions would have to come to an agreement within the week to start paying for health insurance or he would rescind his approval to exceed the cap.
But, on Tuesday, the councilman said the timeline -- and his mandate -- may not have been fair.
"I apologize, but the message is clear that the city is in a situation where we need to do something to balance the budget better, hopefully we can get the unions and the city to work with the mayor. I know there are meetings scheduled and we applaud them for that," Gilbert said.
Davis, the mayor, said he expected to begin a series of meetings with unions this week. He encouraged the council to put any potential cost savings towards lowering taxes.
It will be up to the Common Council to modify and approve a final budget.
Davis said that in principal the tax cap was a good idea, but it is unfair because it paints all municipalities with the same brush, no matter their size. He said that the city, unlike towns, can't break off items like fire protection, lighting and garbage into special districts.
He faulted sanitary sewer remediation, an unfunded mandate by the state, which will cost the city a total of $18.4 million over the next five years.
Services, which include police and fire departments, as well as salaries of other employees -- a total of approximately 125 employees -- as well as employee benefits account for 78 percent of the city's budget.
Davis said salaries for police and fire comprise $5.62 million of the total city salaries of $10.2 million.
"There are things that we as a city have to provide that towns and villages don't," Davis said.