The decision is a preemptive maneuver in response to pending cuts stemming from the state's budget.
"We don't know from the state how much revenue we're going to get. We can only guess," says Mayor Bruce Flax.
The town had to decide on four possibilities with regards to state funding. Either the state wouldn't cut their funding at all or the governor's office would cut either $5, 9 or 13 million from the town.
Council members elected to reduce their operating costs by $5 million which resulted in a residential tax rate increase of 8.7%.
"I believe we've done our best in helping with the tax payers in cutting every little thing we could out of every line item," says council member Diane Barber.
Town leaders say the tax rate increase will cost home owners an extra $190 a year for every $100 thousand dollar home assessment.