Last week on these pages we mused over what might be coming down the pike as a result of the current economic crisis. In the days since, the situation has only worsened and the economic panic that has gripped the country now appears to encompass the entire world.
It’s still hard to know for sure how the major events on Wall Street will ultimately impact life here on the East End – that isn’t likely to be revealed for several more months or even years.
But on the local level, there are already some indications that we may need to do some belt tightening on the East End. With a major shortage already in its coffers, East Hampton Town is expecting to bring in $1.5 million less in mortgage tax revenues this year. We’ve also learned that the town is expecting to raise property taxes by a whopping 19 percent — for East Hampton Village residents, it’s more like 28 percent —while slashing $7 million in the budget. Included in that amount is $1 million in grant money for social and cultural organizations like the East Hampton Daycare and after school programs.
But before you decide to pack up and move to Southampton, you might want to consider this. Mortgage tax revenues have fallen there as well in light of the decline in the building and construction trade. Meanwhile, taxes will go up there five percent this year, the maximum allowed under the cap. Also, given the sluggish housing market, we can expect that the stellar performance of the CPF in both towns to lag. Even before the financial news of last week, Southampton Town was down from $55 million last year to $32 million in 2008. On top of that, federal mandates and rising costs have lead to rising school budgets every year despite school board efforts to keep them reasonable.
For East End residents, this all represents a bitter pill on top of some truly vile medicine. If you have an adjustable rate mortgage on your home, or you’re trying to get a mortgage at all – or a loan for a new car, forget it. Now you can add sharing the burdens of local municipalities to the list of your woes. Though these increased expenses may not have occurred directly as a result of the financial crisis, it’s certainly like getting kicked in the teeth at a time when we’ve been brought to our knees.
Though we have written in the past about ideas like shared services between schools and the reduction in fossil fuel use by walking and biking, driving a Prius or heating houses through alternative sources, in the next year, it strikes us that these are the sorts of cost saving measures where the rubber will truly meet the road.
Given the gloomy economic forecasts, it may just be that these once largely symbolic gestures have become our new way of life as we face a reality that most people on this planet have been living with for years.
So like it or not, you better tighten those belts, folks — we’re in for a bumpy ride.