Olean Common Council asks mayor to look at fees, fines to cut tax hike

“We should approach our permits, fines and fees the way we do water and sewer,” he said, increasing the charges for those who use the services “to take the burden off the taxpayers’ backs.”

He noted that the cost of a ticket for having a dog at-large is $25 — which has not changed in years — and the cost for the city to inspect rental properties was set at $60 in 2017 and never adjusted. Crawford added that the city hired a new employee to handle those inspections, and the cost of that employee has continued to increase with other salaries.

“I guarantee you that the rent on those apartments has gone up,” he said, but cautioned against “pricing ourselves out of business” with too large of increases.

“I’m not suggesting we go out and double or triple our fees,” Crawford added, but he asked for some kind of assessment by next week to continue budget discussions.

“It’s something we can do,” Aiello said. “We’ll do our best to have it for you on Wednesday.”

Crawford said he previously cautioned against efforts to keep property taxes lower than the allowable tax cap, noting the inflation-pegged state mandate tracks with rising costs.

“I distinctly remember reminding past councils that if we continued to come in under the mayor’s 2% increase while our costs go up every single year, it sets us up with this exact situation — looking at a 6% tax increase,” he said.

Jason Panus, R-Ward 2, asked Aiello if, in the face of rising interest rates, the city was confident in projected sales and mortgage tax collections in the new budget.

Under the proposed budget, sales and use taxes are expected to increase $900,000 to $6 million. Mortgage taxes are expected to increase $80,000 to $210,000. The two fees, along with around $445,000 in higher property taxes, account for about 85% of the $1.71 million in estimated revenue increases for the 2023-24 budget.

Aiello noted that several new retailers are planning to open in the city, and demand for real estate remains high. City Auditor Lens Martial also noted that higher prices of retail goods will lead to an increase in sales taxes.

One potential source of revenue is not set to debut, however. Aiello noted that work is continuing on a hotel bed tax — a separate tax charged to users of hotels, such as the one now charged by Cattaraugus County.

A 5% levy would bring in around $220,000 in revenue, the mayor said, citing figures from the county treasurer’s office. However, the implementation would require an act of the state Legislature and then could only be used for a designated purpose.

The county uses its bed tax revenue for tourism promotion, mostly focused on Ellicottville, which is the source of most bed tax revenue. City officials previously discussed using the funds for economic development assistance and marketing.

David Anastasia, D-Ward 7, asked Aiello if there are any penalties against the city for overriding the tax cap, such as lost state aid.

“There are no penalties,” the mayor said, but he added that at least five council members must approve a local law to override the cap before the budget is passed.

The budget is due to be approved by April 15 for a June 1 start. The mayor’s budget proposal calls for just over $20 million in general fund expenditures.