CAPE MAY — City Council unanimously approved its 2026 budget April 21, calling for a 2-cent increase in the local tax rate.
The $29.9 million spending plan includes a tax rate of 38.1 cents per $100 of assessed value. With the average home assessment at $750,000, the average municipal portion of a tax bill would increase $140 to $2,857. The number does not include county or school taxes.
Over the past six years, City Council has kept the rate at 36.1 cents, but rising costs have led to an increase. The city’s largest expense is salaries, which rose by 10.8 percent. The second-largest expense is operating costs.
The 2025 spending plan was $27.9 million, which was up from $26.9 million in 2024.
Auditor Leon Costello said Chief Finance Officer Lauren Read had done an exceptional job. Mayor Zack Mullock thanked Costello, Read, City Manager Paul Dietrich and all the department heads for their work on the budget.
Dietrich noted in his preliminary budget presentation March 3 that the tax increase would help the city avoid getting further behind or hitting the fund balance harder.
Mullock said the Cape May Taxpayers’ Association recommended a tax increase over the past few years.
“To their point, we want to make sure we’re in healthy shape and that’s exactly what we’re doing in this budget,” Mullock said, adding that it was important to maintain a good fund balance because of the town’s tourist-based budget.
By RACHEL SHUBIN/Special to the Star and Wave