Middletown Mayor Proposes 5 Percent Property Tax Increase

MIDDLETOWN, N.Y.—Joseph DeStefano, mayor of the city of Middletown, has proposed raising property taxes by about 5 percent to cover rising costs across several departments.

If the tax increase is passed, it will end Middletown’s 15-year streak of not breaking the state tax cap. The 2026 tax cap is 2 percent, meaning municipalities cannot raise taxes by more than 2 percent over what they already were.

A local ruling or law can override the tax cap if it passes with 60 percent approval.

DeStefano said at the Oct. 27 city council meeting that the budget he’s proposing will maintain Middletown’s character.

“It reflects our priorities: clean neighborhoods, dependable garbage collection, safe streets, winter storm response, maintaining roads, parks, playgrounds, public spaces, programs and services that we’re all accustomed to in our community,” he said.

In an Oct. 28 letter, the mayor said the tax levy increase over the cap would total $507,000.

DeStefano said a median-value single-family home in the city would add $48.68 per year in property taxes. For a business with a taxable value of $50,000, it would be $100.

DeStefano said Middletown’s tax levy is split across about 6,000 individual single-family homes.

The letter listed several reasons for the levy increase: rising gas and diesel prices, water treatment chemicals, and vehicle maintenance.

The mayor said that tariffs have increased operating costs and uncertainty, and that health insurance, pensions, and labor contracts are increasing spending. This budget added $1.3 million for benefit costs for current and retired employees.

The police department is increasing its budget by $518,000 because of contractual obligations. The department now has 75 officers, the maximum number it can legally employ.

The city is looking to make positive cuts and increase efficiency, DeStefano said.

“I recognize that every dollar matters. Seniors on fixed incomes, working families, and small businesses are managing their own rising costs. That is why we continue examining spending and seeking ways to operate more economically,” DeStefano said in the letter.

The mayor said that if the city cuts any programs or services or reduces the budget, the public should have input on the decision.

“Cutting maintenance can leave us with larger repair bills later. Cutting personnel can affect response times and our ability to complete essential work. Cutting recreation and senior programs takes away opportunities and connections that residents value,” he said in the letter.

The mayor said the city could save costs with current EMS services. The city paid $800,000 for EMS services in 2026, and costs could be reduced if the fire department were to become EMT-certified. The process will take three to five years of professional development.

The city could also receive more revenue using its sewage and water system. Between January and August of this year, the city made $194,000 off water sales to nearby municipalities. A pending agreement with Goshen would also increase water revenue.

DeStefano noted that other municipalities are also blowing past the tax cap. Wallkill is looking at 10 percent over the cap because of financial struggles.

A report from the state comptroller’s office found that in 2026, 45 percent of cities planned to override the tax cap, 35.5 percent of towns did, and 24.6 percent of counties did.