Penn Yan village officials are proposing a 2026-27 budget that stays just under the state tax cap, but only by leaning on fund balance — a strategy some leaders say may not be sustainable.
During an April 13 meeting, the Village Board reviewed a tentative budget that includes a 4.57% tax levy increase, narrowly below the allowable cap, with an estimated $95 annual increase for the average property owner.
To keep the increase within the cap, the plan uses more than $363,000 in fund balance, a move officials acknowledged cannot continue indefinitely. Without that support, the tax levy increase would jump to nearly 14%, highlighting a growing structural challenge for the village.
Clerk-Treasurer Holly Easling told the board the village has relied on fund balance in recent years to offset rising costs, but warned that one-time revenues should not be used to support ongoing operations. Trustees echoed concerns that declining or uncertain revenues, including potential changes to county sales tax sharing, could worsen the situation in future budgets.
Spending pressures are being driven largely by personnel costs, including wages and benefits, which are expected to continue rising due to labor agreements and inflation. Health insurance alone is projected to increase significantly, while retirement costs are also climbing.
The budget also includes major capital investments, including building upgrades at Village Hall, the firehouse, and other municipal facilities. Combined annual debt service tied to those projects is estimated at about $160,000.
Fire protection costs are another key factor, with the Fire Department budget increasing more than 25%. That increase will be passed along to contract customers in surrounding towns, raising costs based on assessed property values.
Board members also discussed potential savings and reallocations during the meeting. One proposal would eliminate funding for a parking enforcement position and instead use those funds to raise wages for village court clerks, bringing them more in line with neighboring municipalities.
On the revenue side, the village is anticipating modest gains, including about $10,000 from a new tax on adult-use cannabis sales. Officials also noted plans to pursue a local bed tax on short-term rentals in the future.
The board closed the public hearing on the tentative budget and is expected to consider adoption at an upcoming meeting.
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