Southold Town budget hikes tax levy by 2.87%, falls under cap

Southold Town’s proposed $65.9 million spending plan for 2027 would bump taxes but below the state cap, amid rising costs, according to Supervisor Al Krupski.

The tentative budget calls for a 2.87% tax levy increase, to $46.2 million. Spending would rise $1.8 million, to $65.9 million.

Krupski said the budget maintains town services while keeping spending to a minimum. “We gave everybody a little bit of a haircut,” he said in an interview, adding that the strain of state-mandated healthcare and pension costs remains a challenge, along with rising fuel prices.

Michelle Nickonovitz, the town comptroller, said the plan translates to a $65 annual increase for the average taxpayer. The budget is now under town board review ahead of a Nov. 4 public hearing.

Earlier this month, Krupski joined other Suffolk supervisors to call for changes to the state tax cap formula and criticize state-mandated employee costs, which are key cost-drivers.

“There should be no such thing as an unfunded mandate,” Krupski said. “If we want young people to stay on Long Island … you can’t make it so unaffordable. You have to be realistic about what services government can provide.”

The plan includes 2% raises for elected officials and adds a new full-time code enforcement director, who will be responsible for handling quality-of-life complaints and a new short-term rental permit program. The town board is still working on revamping its rental laws.

Though the budget does not call for layoffs, staffing levels have been reduced. Southold currently has 217 full-time employees, according to Krupski’s budget message. Last year, there were 237 full-time positions, the supervisor’s 2025 letter said.

Jill Doherty, the sole Republican on the six-member board, shared frustrations over what she described as “uncontrollable” employee costs. But she said she is concerned that reduced staffing levels will threaten services and employee well-being.

“Over the years, we have been cutting personnel through attrition, and there comes a point where you can’t do that anymore because it’s a safety issue,” Doherty said in an interview. "We can’t get to certain infrastructure things that we need to repair … you burn out the employees, and morale goes down.”

Rising fuel costs amid the U.S. war with Iran are also straining local budgets.

Town board member Brian Mealy said he was “very concerned” about the impacts higher fuel costs would have on town departments at an Oct. 2 budget meeting. “That’s what I’m looking for: How does that affect our budget, and how can we continue to work and continue to provide services when we have those things that are beyond our control?” he said.

Krupski’s proposal funds $3 million in capital projects and purchases, including $720,000 for road paving, $283,000 for police cars, $250,000 for stormwater projects and $130,000 for a compost site storage building.

Legal settlements have drained the contingency fund this year, adding pressure to manage it carefully in the year ahead. The fund was depleted in June after the town made a $337,889 payment in a Mattituck eminent domain case that Krupski said cost the town $2.76 million overall.

The town used eminent domain to seize a property at the corner of Main Road and New Suffolk Avenue in 2020, stifling plans for a hardware store at the site.

Krupski, who was not supervisor at the time, cited the case as an example of how costly and lengthy those proceedings can be. “If you embark on an eminent domain, you better be sure and be very clear of what the consequences will be,” he said.

Southold’s 2026 budget remained within the tax cap after Krupski’s first budget in 2025 exceeded the cap with a 7.48% levy increase. Public hearings on the budget will be held on Nov. 4 at 4 p.m. and 6 p.m.