WEST CAPE MAY — Taxpayers will get a break this year, due in part to the sale of the borough’s first liquor license.

Borough officials had promised to use the money for tax relief, and the first installment, $45,000, will help reduce the tax rate this year by 1.5 cents for each $100 of assessed valuation. It could make the borough one of the few in the region to reduce property taxes this year.

“There won’t be many reporting a decrease,” borough Auditor Leon Costello said.

Borough Commission held a budget work session Wednesday night that initially fashioned a 1.4-cent decrease, with 1 cent coming directly from the liquor license sale. Mayor Pam Kaithern pushed to make it an even 1.5 cents.

“There are a lot of people out of work,” Kaithern said.

Voters in 2008 approved the sale of two liquor licenses, one for a restaurant and one for a liquor store, by a large margin. The margin, however, was even larger for a third question asking whether voters wanted the money to be used for tax relief. That passed 416-125, meaning 77 percent of voters approved it.

The liquor store license was sold for $615,000 last year to Sunset Liquors, and the money was put in a trust for tax relief, a minimum of 1 cent on the tax rate, and this is the first year it was used.

Even without the license sale, Costello said, the budget was going to decline anyway, mostly because debt service is declining.

“There hasn’t been any new borrowing for a while, so we’re starting to run out of debt,” Costello said.

The preliminary budget, which could change before introduction Feb. 27 and adoption March 27, is $2,131,710, a decrease of $237,076, or about 10 percent. The tax rate would decline from 34.6 cents per $100 of assessed valuation to 33.1 cents, or by about 4 percent.

The tax bill for a $400,000 home, which Costello said is close to the average assessment in the borough, would decline from $1,384 to $1,324, or by about 4 percent.

“On a $400,000 home, it would be $60 less in taxes,” he said.

Overall, the borough seems to be in great financial shape. Surplus is rising from $434,000 entering the budget year last year to $497,000 this year. Last year, the budget left behind only $181,000 in surplus, and this year it is $277,000. Debt is being paid off, and there is still plenty of money in the liquor license fund.

Borough Chief Financial Officer Frank Donato said the town is in “a good position going forward.” Costello said the borough is “healthier than (it’s) ever been.”

The commission is factoring in raises at the 2 percent level for all employees and one new hire, replacing a part-time worker in finance with a full-time worker.

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