Proposed Plum budget carries no property tax increase after hike last year

Plum property owners would see no change in their borough property tax bills under a proposed $26.3 million 2025 budget, finance director Michael Whitico told council during a presentation last week.

The tax rate was increased by nearly 40%, from 4.78 mills in 2023 to 6.63 mills in 2024, which was the first increase since 2017.

The annual borough property tax bill on a home at Plum’s median assessed value of $116,700 would remain at about $774.

The increase approved for 2024 is expected to carry the borough through at least five years, to 2028, Whitico said. The borough’s general fund, the largest part of the budget, would receive $17.3 million in revenue while spending $16.7 million, leaving a $634,000 surplus, he said.

Surpluses are expected in the first three years, with a smaller surplus in the third year and the borough needing to spend from the surplus in the fourth and fifth years to get through its five-year plan, Whitico said.

“At this time, I still think those projections are pretty solid,” he told council. “We should be good through at least five years and possibly six.”

The proposed $26.3 million budget represents a $1.1 million increase, or 4.4%, over this year’s spending plan, Whitico said.

Health care costs are increasing by 9% and insurance costs are expected to go up by 5%, he said.

There are job positions that are vacant or expected to become vacant. They include an in-house engineer, which the borough has been trying to hire for two years; a public works supervisor; two public works laborers to replace retiring employees; and a vacancy in information technology.

The budget includes a $300,000 transfer that Whitico proposes should happen before the end of the year. It would go from the borough’s general fund to its capital improvement fund to pay for a stormwater project, where there is a shortage of money to complete the work. Council previously approved using the money, from covid funding, for stormwater projects.

In the general fund, the borough gets 82% of its revenue from real estate taxes, income taxes and sanitation fees, Whitico said. Revenue in the general fund is expected to increase by about $235,000, or 1.4%, over this year, with $6.6 million coming from real estate taxes.

About 72% of spending is for public safety-police department, public works and sanitation, Whitico said. Total general fund spending is increasing by about $650,000, or 3.9%.

Public safety-police department is the borough’s largest department, Whitico said. Its total budget is $6.42 million, up 6%, or $364,000.

“We have budgeted for no new hirings, and there aren’t any planned retirements that we are aware of,” he said.

Police general wages increased by about $224,000. The police contract carries a 3.5% pay increase, and officers also are progressing up the wage scale, Whitico said.

Council will vote to advertise the budget for public inspection when it meets at 7 p.m. Wednesday at the municipal center on Mike Thomas Way.