Turning over Williamsville’s water system to Erie County will mean lower water rates for village customers.
But it also means a spike in village tax bills for the upcoming budget year.
Costs associated with the transition will force Williamsville to increase the tax levy – the total amount to be raised in taxes – by 8.6 percent in a tentative $3.4 million general fund budget for 2014-15.
That’s well above the 2 percent state-mandated tax cap, and the Village Board will need to pass a local law to allow for the increase.
A rise in some commercial values has boosted the tax base in Williamsville, softening the blow a bit for residents, who will see the property tax rate increase of 5.79 percent to $4.53 per $1,000 of assessed valuation, up from $4.28 per $1,000.
Still, officials are having a tough time trying to explain a tax increase that was created by a cost-saving measure.
Mayor Brian J. Kulpa said the village is right to merge its water system with the Erie County Water Authority, which will drop village water rates from $5.81 per 1,000 gallons to $4.05 per 1,000. The change is set to take effect June 1, he said.
The problem, Kulpa said, is that the village will have to pay an annual hydrant fee of $45,000. Furthermore, the mayor added, another $90,000 in administrative costs that had been covered by funds from the village water system now have to be included in the general fund.
If it weren’t for those charges with the water consolidation, village taxes would actually be going down, Kulpa said.
But even with the tax hike, he said, Williamsville taxpayers should be saving money because of the lower water rates.
“The two combined still equate to a savings,” Kulpa said.
A public hearing on the budget is scheduled for the March 24 Village Board meeting.
Williamsville’s preliminary 2014-15 spending plan is up 5.6 percent to $3,417,199. Property taxes account for 48 percent of the village’s overall revenue.
Sewer usage charges will remain $4.07 per 1,000 gallons.