Mount Vernon is bracing for a 4.97% tax increase in 2025, as outlined in the city's proposed annual budget. This increase comes amid a decrease in property valuations, which have dropped by $700,000 from the previous year, now totaling approximately $145.8 million. The tax hike translates to an estimated $249 increase for homes assessed at $10,000, equating to about $20.75 per month.

City officials highlighted that the budget's challenges stem from ongoing unfunded mandates and stagnant state aid, which has remained at around $7.1 million for the past decade, despite a population increase of nearly 7,000 residents. The rising costs of health insurance and retirement benefits have further strained the budget, with health insurance costs soaring from $13.1 million in 2013 to $27.5 million in 2025.

Mount Vernon has faced significant financial hurdles, lacking a fund balance to cushion against these rising expenses. Unlike neighboring cities like White Plains and New Rochelle, which utilize their fund balances to stabilize tax rates, Mount Vernon has not had a fund balance for five consecutive years. The city previously relied on COVID relief funds to offset budget deficits, but those funds are no longer available, leading to a projected 4.97% tax increase for the upcoming year.

The budget also includes a contingency for collective bargaining, a new requirement due to the absence of a fund balance. While the city has managed to keep certain fees, like the sewer and refuse sustainability fee, stable for four years, the overall financial outlook remains challenging. With departmental appropriations increasing slightly, the city is under pressure to control operational spending while addressing the rising costs of benefits and salaries.