Mayor Michaels

Fulton Mayor Deana Michaels, pictured above at a July city council meeting, called for officials to "go back to the drawing board" on the 2021 city budget after a late update to the full valuation of taxable property in the city came in lower than anticipated. Michaels called what would have been a roughly 1 percent tax hike "unacceptable," and said city officials would make further cuts and present a modest tax reduction prior to a second public hearing on the budget Dec. 15. 

FULTON — Fulton is slated to hold a second public hearing on the 2021 city budget later this month after a late surprise turned an expected 0.69 percent tax increase into a nearly 1 percent increase, prompting city officials to re-examine the spending and revenue plan.

The Fulton Common Council on Dec. 1 held a hearing on next year’s roughly $17 million spending and revenue proposal, but prior to the public comment period Mayor Deana Michaels said a late reduction in the full assessed value of the city would have led to a tax rate increase roughly 30 percent higher than expected.

Michaels expressed frustration at Tuesday’s council meeting, calling the nearly 1 percent increase “unacceptable,” and vowing to work with councilors and city department heads in the coming days to make further cuts.

“We’ll go back to the drawing board,” the mayor said. “We are in no way, shape or form ready to move forward in that direction ... the last thing we need is a tax increase.”

Michaels said officials would seek to present a modest tax cut in the coming week and hold a second hearing on the budget Dec. 15.

Reductions in the full valuation of taxable property in the city has been one of the biggest obstacles Fulton has dealt with in recent years, and the issue again has caused problems for city officials working to craft a budget. The overall assessed value of taxable property dropped for at least the third year in a row, falling from about $335 million to $332 million.

Fulton has lost more than $5 million in assessed property value since 2018, which places a further burden on the city’s remaining tax base.  

Total spending in the city’s 2021 tentative budget proposal is estimated at $16,964,467, a roughly $128,467 increase from the 2020 spending plan. Revenues are also expected to increase slightly, from $10.04 million to about $10.16 million.

Personnel services, or employee salaries, and employee benefits account for the overwhelming majority of the city’s expenses. Salaries make up about 46 percent of total spending, and employee benefits account for nearly 36 percent. Public safety spending, which makes up more than one-third of the city’s total spending, is down about 4 percent, from $6.9 million to $6.6 million.

The originally proposed $16.96 million spending and revenue plan would have resulted in a property tax rate of $20.69 per $1,000 of assessed value, up from the $20.50 per $1,000 rate in the current year.

Fulton has held tax rates steady since the 2016 budget, which increased taxes a little more than 4 percent.

Before any final changes proposed by Michaels, the budget resulted in a roughly 0.94 percent tax rate increase that would equate to about $25 or less for most property owners. Prior to the late decrease in the city’s valuation, the average homeowner would have seen a roughly $15 property tax increase.

Michaels said there are “a few adjustments” that could be made to the current plan, including reductions in medical spending and shaving several thousand dollars from each city department budget.

“I’m proposing we actually have a tax decrease a week from now after we work all the numbers,” the mayor said Tuesday. “We can’t keep going in the direction we’re going and expect to get ahead. ... The taxpayers of Fulton, New York cannot afford to continue to move in this direction. It’s plain and simple.”

Following the proposed cuts, Michaels said the budget would hold a slight tax cut of roughly 0.2 percent.

If Michaels’ proposed cuts come to fruition, a property valued at $75,000 would pay about $1,506 in city property taxes, down from roughly $1,548 in the initial tentative budget, while a $100,000 property owner would pay roughly $2,008, down from $2,064. Those figures exclude school and county taxes and other fees.

The Fulton Common Council will hold a public hearing on the proposed budget at 7 p.m. Dec. 15 at the Fulton Municipal Building.

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