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Amsterdam, NY ,
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Highway tax a necessary evil

Saturday, October 27, 2012 - Updated: 7:30 PM

The good times apparently can't roll forever in the town of Amsterdam.

Town residents have enjoyed not paying any town tax for 22 years, but like most places in upstate New York, revenues are down and expenses are up. In response, Amsterdam town officials may have to implement a highway tax to make up the difference.

The tax itself isn't all that bad -- $7 per $1,000 of assessed property value, meaning a person with a $100,000 home would have to cough up $70. In theory, however, implementing it isn't all that desirable because residents already pay high county and school taxes, and the town would have to override the state's 2 percent cap on property tax increases. The new tax would be applied to the town's highway fund.

The town of Amsterdam is in a situation where it may be forced to put the tax in place. Without it, Supervisor Tom DiMezza says it would mean laying off three highway department employees, which would mean more delays for Amsterdam's 10-year road maintenance schedule, which is already two years behind.

Applying fund balance -- a tactic employed by many municipalities to stave off tax hikes for as long as possible -- isn't an option because town officials said there practically is none in the highway department budget. That leaves the town with one other avenue to counteract increasing costs: cutting services. We understand the town's reluctance to take that route, which may not yield much savings anyway.

It's rare that we would encourage any municipality to implement new taxes, but there may not be any other choice. Town officials acknowledged this week that the numbers could be juggled this year to avoid the tax, but it could hurt the town in the future if accounts start showing negative balances, which in turn would affect Amsterdam's bond rating and its ability to make payroll.

With the commercial boom on Route 30 and more housing developments planned, it's imperative that the town of Amsterdam is able to maintain its roads to handle increases in traffic. It's not just an appearance thing, it's also a safety issue.

It's remarkable that the town has been able to go for more than two decades without taxing its residents, and it's unfortunate that streak may have to come to an end.

We encourage town officials to take another look at the budget to see if there are any savings to be found to avoid implementing this new tax -- which should be a last resort for any municipality.

If it turns out that the new tax is unavoidable, at least it's a small price to pay to keep town government in operation. While it's not ideal, it would keep the town from implementing more taxes or drastically cutting services in the future.

     

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