Long Beach proposes double-digit tax increase

The City of Long Beach Thursday night proposed a 2023-2024 budget that carries a tax rate of  12.74% - the highest such level in decades and more than double last year's adopted 5 percent rate.

The proposed double-digit tax rate is primarily the result of a $75 million settlement with the developer Sinclair Haberman, who filed suit after a building he had proposed to construct was blocked. Haberman's suit was originally $130 million, but over a period of years had grown to $150 million. The city negotiated the settlement down to $75 million but must pay $5 million to Haberman per year. That is the so-called "Haberman levy." 

The city said in a statement that, "the  Homestead Tax Rate increase is 12.39% or approximately $574 per the average valued home. The Haberman payment constitutes 83.4% of the Homestead Tax Rate increase. Without Haberman, our increase would be 2.06% or approximately $108 per household. The impact to correct the financial crisis is unfortunate and acknowledged."

The city blames "years of inadequate budgeting, poor financial management, and a catastrophic legal judgment all of which combined to create significant financial stress for the City."

It said also that "The process of unraveling and correcting years of mismanagement fell to a newly elected City Council and new administration in 2020. Over the next three budget cycles, the City took decisive action and the results are significant."

The City said its financial position has improved, having been removed from the New York State Comptroller's list of most fiscally stressed municipalities. It said also its last three budgets have been balanced and that the budget did not require borrowing for separation payments. The city had been sharply criticized for some of those separation payments and has filed suit to claw back some of the money that went to former city employees and officials.

Overtime pay for the city's firefighters — a bone of contention among some city residents, is up slightly in the proposed budget, to  $1.2 million, from $1.19 last year.

Total pay for the city's police department is proposed to be just over $13. million, from just over $9 million last year.

City council member Roy Lester acknowledged Friday that he is "unhappy" with the budget, but added, "We will continue to work on it."

Resident Ron Paganini, a former CSEA official who frequently speaks at city council meetings, commented specifically on the overtime for firefighters. "It's better," he said. "But it's not good enough." He said more work needed to be done on the overall budget.  "People are not going to be able to afford to live here," he said.