The village of Lake Placid experienced a reduction in its total assessed value for 2011, making this the third consecutive year of declines.
Lake Placid Mayor Craig Randall says that makes it much more challenging to manage local government expenses.
"The board worked hard to keep expenses down to avoid increasing the tax rate, but certain expenses such as contracts and mandates must be funded," Randall said in an email sent to WNBZ recently.
Randall points out that 65 percent of the village's general budget involves contractual commitments and mandated costs that cannot be changed in the near term.
"Therefore, with these expenses and falling assessed valuations, it increases taxes," Randall said.
During the 10 years prior to 2008, taxable assessed valuations for Lake Placid increased by nearly three times, from $214 million in 1999 to a high of $630 million in 2008.
During those years, Mayor Craig Randall says property tax rates dropped by more than 50 percent, from $10.80 for every $1,000 of assessed value to $5.18 for every $1,000 of assessed value.
But those days are over for a while, according to Randall.
As the collapse of the real estate market rippled across the country, homes in Lake Placid began selling for less money, and by 2009 assessed values began to decrease.
Since the high in 2008, the village's total assessed value dropped roughly $15 million. During that time period, the tax rate increased by about 15 cents per $1,000 of assessed value.
The village board of trustees voted last week to approve its first tax rate hike in decades, a 1.3 percent increase over the current budget. And since assessments dropped again this year, the tax increase will add just $42,000 to the village's projected tax levy of $615 million.
Randall says the village would have had a zero percent tax increase if the assessments hadn't declined.
A public hearing on the village's proposed budget will be held at 5:30 p.m. Monday.