Property tax rates would drop by nearly 5 percent for homeowners and 9.2 percent for businesses in the proposed budget Mayor Byron W. Brown will unveil Tuesday, The Buffalo News has learned.
Although tax rate declines would average 7.5 percent, tax bills for the fiscal year beginning July 1 would rise for about 15 percent of property owners because of higher assessments. The increases in assessed values have resulted in lower tax rates because the tax levy -- the amount of money raised through property taxes -- will be spread across a bigger base.
Brown's budget will propose holding the line on the property tax levy, with the city compensating for a 1.4 percent increase in day-to-day departmental spending through attrition, reductions in borrowing costs and higher projected sales tax revenues, among other means.
The mayor hesitated to discuss budget specifics pending Tuesday's release. But he confirmed the plan will call for cutting tax rates while funding programs to strengthen the city's economy as well as its neighborhoods.
"Our budget is growing below the rate of inflation while still making critical investments that will improve the quality of life," Brown said.
He cited public safety as one area in line for enhancements. The plan will call for hiring at least 40 police officers. This number could increase to 67 if all public safety officers laid off by the Buffalo Municipal Housing Authority passed the police exam administered earlier this month. The hirings could push the size of the police force to more than 800 for the first time in more than two years.
Police ranks have been shrinking since 2003 as part of a labor contract that included a move to one-officer cars. But Brown, Common Council members and Police Commissioner H. McCarthy Gipson all have argued that a plan to reduce the force to 675 is misguided.
"We think that this [increase in officers] will be the actual right-sizing of the Police Department," Brown said. "It has become very clear to us that the 675 number is not realistic."
Other key elements of the budget, according to city sources, include using $12.8 million in additional state aid for targeted economic development projects -- for example, acquiring properties, cleaning up sites and making them "shovel ready" for developers.
New figures from tax officials, meanwhile, show that the typical home in the city is assessed at slightly less than $59,200.
The mayor's spending plan would reduce residential tax rates by 4.7 percent, meaning a $60 a year tax cut for the average homeowner.
For nonhomestead properties, which include businesses, most multiple dwellings and other commercial properties, the 9.2 percent cut in the tax rate would mean a reduction of about $330 a year for a property assessed at $100,000.
Finance Commissioner Janet Penksa said the administration's plan to cut the tax rate, hold the line on the tax levy and keep general spending below the inflation rate bodes well for the city's long-term goal of "fiscal independence." City officials are itching to remove the active role of the state control board that has overseen city finances for nearly four years.
"We believe we will present a conservative, modest-growth budget that shows prudent fiscal management," Penksa said.
New proposals include plans to expand the city's "quick response teams," which grapple with neighborhood quality-of-life complaints such as litter-filled lots. The budget will also provide for an expanded citywide graffiti blitz, Penksa said.
While overall spending in the city's general fund -- money used to pay for day-to-day costs -- would rise by 1.4 percent, officials said some expenditures continue to create pressures. Health insurance for city employees, for example, is projected to cost 9.9 percent more in the new fiscal year, said Donna J. Estrich, the city's administration and finance director.
This is Brown's second budget as mayor; his first cut tax rates an average of 2.5 percent.
"Overall, that's a 10 percent reduction in tax rates since the Brown administration took office," Penksa said. "We think that's pretty significant."
The Common Council will have three weeks to make any changes in the spending plan. Lawmakers are scheduled to begin hearings Tuesday. Brown said the administration welcomes the Council's advice, but he hoped lawmakers won't find the need to make sweeping changes in the plan.
"I suspect there will be broad support for this budget," the mayor predicted.