New Berlin budget could be slightly more taxing

New Berlin - A zero increase operating budget that nevertheless requires a 2.69 percent increase in the property tax levy for city services has been proposed by Mayor Jack Chiovatero.

Mainly responsible for the proposed levy hike is a $644,895 increase in debt service, he told aldermen, meeting as a committee of the whole this week. Most of that debt is for road work, Chiovatero said.

The Common Council will review the executive budget proposal starting Sept. 25, but, already, Alderman Ron Seidl said he couldn't support the proposed budget as it stands.

The proposed nearly $34.7 million total budget for 2013 is $419,966, or 1.23 percent higher than the 2012 spending plan. The proposed levy is more than $24.6 million, compared with $24 million for 2012.

Property values' impact

Although the proposed levy is 2.69 percent higher, property taxes on an average home are expected to go up only 1.21 percent, or $15.18, said Ralph Chipman, city treasurer. That's because the average value of residential properties fell more than the average values of other types of taxable property, meaning that homes will shoulder a smaller portion of the total property tax burden.

The estimated tax rate for the proposed 2013 budget is $5.61 per $1,000 of assessed value, which is 11.94 percent higher than the previous year's $5.01 per $1,000. The reason the rate shot up is that the city's tax base shrunk nearly 7 percent after the citywide revaluation this year. So, there are fewer thousands of dollars to tax.

Although the proposed rate is way up, the average homeowner might not pay that much more in actual dollars, Chipman said. Citing an example, he explained that the average home that was assessed at $251,400 has been reassessed at about $227,300. That means the owner would pay $15.18 more than last year, a 1.21 percent increase.

The impact of the proposed higher tax rate on specific properties depends on how they have been re-assessed.

While the projected tax increase would be 1.23 percent for residential properties, it calculates out to a 6.3 percent increase for commercial properties. The increase is higher because commercial properties have held their value better.

For example, a commercial building assessed at $400,000 would have been reassessed at $380,000 this year - an average 5 percent lower. So, the additional taxes would come to $127.

Budget considerations

The proposed budget includes no layoffs, furloughs or service cuts, Chiovatero said. It does include a 2 percent raise for employees, whose pay hasn't gone up in four years, he said.

Alderman John Hopkins supported the raises, saying private industry is starting to give small raises.

Officials expect state aid to be the same next year, Chiovatero said. But property taxpayers have been fighting a losing battle as they pay a larger percentage of the budget. In 2007, property taxes were 66 percent of revenues compared with 70 percent this year, Chipman said.

Considering the demands that had to be met, Chiovatero said, "It's a decent budget."

NEXT STEP

WHAT: New Berlin Common Council review of 2013 proposed budget

WHEN: noon to 5 p.m. Sept. 25

WHERE: City Hall, 3805 S. Casper Drive

AT A GLANCE

Proposed New Berlin budget for 2013: $34,671,141

2012 budget: $34,251,175

Difference: up $419,966, or 1.23 percent

Proposed levy for 2013: $24,642,010

2012 levy: $23,997,115

Difference: up $644,895, or 2.69 percent

Proposed property tax rate for 2013: $5.61 per $1,000 of assessed value

2012 property tax rate: $5.01 per $1,000

Difference: Up 60 cents per $1,000 or 11.95 percent