Saratoga Springs proposes 18% property tax increase for 2027

The City of Saratoga Springs would raise its property tax by 18% next year under the 2027 budget that Commissioner of Finance JoAnne Kiernan presented to the City Council at a budget workshop on Tuesday, Oct. 6, The Daily Gazette reported. The proposal also cuts the city workforce by about 4%, trims capital projects and suspends city funding for nonprofits.

It would be the city’s largest tax increase in more than a decade, according to the Gazette, and the council would have to override the state property tax cap to adopt it. Public hearings on the budget are scheduled for Oct. 20.

The proposal at a glance

These are the main pieces of the finance department’s plan, as reported by the Gazette and CBS6.

• The city property tax would rise 18%. A home assessed at $500,000 would pay about $640 more a year, or roughly $53 a month.
• The city workforce would shrink by about 4%, and the hiring controls the council put in place in June would stay.
• Capital spending, including some construction projects, would be cut back.
• City support for nonprofits the city has long funded would be suspended.
• Fee-based revenue would be reviewed, and a multi-year forecast would guide future budgets.

Why the city says it needs the money

Kiernan has warned about deficit spending since she took office in January, and our Sept. 23 story laid out the $5 million gap she described as the 2027 budget took shape. CBS6 reported that the city now faces a current deficit of at least $5 million and about $7 million for 2027.

Personnel and employee benefits make up 83% of the city’s operating costs, and health insurance and retirement costs keep climbing, Kiernan told the council. CBS6 reported that the city also cited liability insurance, and that officials named the new fire station as one of the biggest pressures. A federal SAFER grant had paid for staffing at the station, and that grant has expired.

Overtime is another problem. The Department of Public Safety had already spent 105% of its 2026 overtime budget with 12 weeks left in the year, according to the finance department’s figures as reported by the Gazette.

“This is about being proactive rather than waiting until we have no choices left,” Kiernan said of the increase, according to the Gazette. Her long-term goal, she told the council, is a balanced budget that pays for recurring costs with recurring revenue. She also told CBS6 the city needs to modernize its processes and improve workforce planning.

The fund balance problem

The deeper issue, as Kiernan described it, is that the city has leaned on its savings to cover recurring costs. Fund balance should be a cushion for emergencies, she said, not a way to fill the gap between what the city spends and what it takes in. She also said the city has historically not used its full taxing capacity to spare homeowners, which is part of why the increase is so large now.

The city charter requires a minimum fund balance of $6.8 million. The balance is projected at $7.1 million at the end of 2026 and could fall to about $4.59 million in 2027 if nothing changes, according to the finance department’s figures. Kiernan said the 2026 budget underestimated expenses, which were set under the former finance commissioner, Minita Sanghvi, who is now a Saratoga Springs county supervisor.

Mayor John Safford backed the commissioner’s approach. He said that if the city does nothing, the fund balance will be gone next year, and that the city could skate by this year but is choosing to address the problem now, the Gazette reported.

What it means for the fire department

The proposed layoffs drew the sharpest reaction. Commissioner of Public Safety Tim Coll said he was deeply frustrated by any layoffs in his department, especially in the fire department, but understood the city had little choice, according to the Gazette. He said young firefighters, some with families to support, could lose their jobs.

Fire Chief Dolan said it was too early to know what the budget would mean for the department until he goes through the numbers, and that the department’s requested budget and the finance department’s proposal do not look much alike, the Gazette reported.

What it means for nonprofits and businesses

The suspension of nonprofit funding affects groups that have counted on yearly city support, though the reports did not list which ones or how much money is involved. The city property tax applies to commercial property as well as homes, so downtown building owners and other businesses will feel the increase too.

Our read: an 18% increase sounds dramatic, but the dollar figure on a typical house, about $640 a year at a $500,000 assessment, is the number most residents will weigh. The bigger fight will be over which jobs and services get cut to keep the increase from going higher.

What happens next

The budget is a proposal, and the council can change it before adopting it. Here is what comes next, based on the reporting.

• Workshops continue, including the Public Works and Recreation budget workshop.
• Public hearings on the 2027 budget are set for Oct. 20, the same night the council continues its hearing on proposed zoning changes.
• To adopt an 18% increase, the council must first vote to override the state tax cap, which limits annual levy growth to 2% or the rate of inflation, whichever is lower.

For more on the other big item on the Oct. 20 agenda, see our story on the proposed changes to the city’s development rules.

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