By RICK MILLER
Olean Star
OLEAN — City of Olean taxpayers can expect something in the mail soon — a new tax bill.
Mayor Bill Aiello announced Thursday morning that “due to a calculation error, the city will be reissuing tax bills. As we work to rectify the situation, the City Clerk’s Office will not be accepting (property tax) payments.”
Alderman learned Tuesday that the budget they passed included a 7.13% increase in the tax levy, not the 6.2% hike that was approved 5-2 on April 8.
The issue was disclosed during the Common Council’s Finance Committee meeting Tuesday night, drawing the ire of committee chairwoman Sonya McCall, D-Ward 4.
“It is not our job to calculate out the percentage” of increase in the tax levy,” McCall said. “We told the public in good faith that it was 6.2%. Our expectation is that we will get accurate information.We had no idea it was 7.13%. I don’t think anyone would have voted for it.”
The city’s $19.8 million budget for 2025-2026 is actually down $618,000 from the 2024-2025 budget. The tax levy $8.56 million. That is likely to be reduced by about $70,000, the difference between 7.13% and 6.2%.
The error in the tax rate increase will not have any impact on the water or sewer budgets. The sewer fund is $4.79 million, up $292,000 and the water fund is $4.5 million, up $219,000.
The council is expected to vote Tuesday, May 27, on corrective action to fix the latest budget snafu.
McCall noted that in the last year the city also faced a $1 million shortfall in sales tax receipts that required extraordinary measures to keep e xpenses in check. There was also $700,000 that was not included in the budget for health insurance payouts, she said.
City Assessor Gregg Piechota assured aldermen that the tax did not change. The tax rate was miscalculated because the wrong tax rate from 2024-2025 was used, he said. “Everything in the budget, except for the tax rate increase, is correct.”
The mistake equals 14 cents per $1,000 on the tax bills, said Piechota.
How do we correct this” McCall asked. The city will not receive enough revenue to m et the expenses of the $19.8 million budget.
“Why wasn’t this caught?” asked Alderman David Anastasia, D-Ward 7. “How are we going to fix it for the public?”
Aiello said the council could either modify the budget or re-issue tax bills.
“We need to fix this,” said Alderman Vernon Robinson Jr., I-Ward 6.
“We can’t make residents pay more because of an error,” said Jennifer Forney, R-Ward 3. She said new tax bills would have to be mailed out and refunds made to those who have already paid.
“We can’t keep eating mistakes,” said Alderman Lawrence Bennion, R-Ward 1. “Amending the budget to 7.13% is unacceptable.”
Aiello said the council will have a resolution to be voted on Tuesday on how to proceed. About $70,000 in cuts to the budget are expected to be made in the amended budget. There will be no penalty for paying in June and July. Late payments in August will add 1% to the tax bill and September payments will have an additional 2% markup.
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