Hanover Borough residents will pay 25 percent more in property taxes this year than in 2012.

Years of significant spending cuts spared the southern York County borough a tax increase for nine years. But it also left Hanover with little wiggle room as officials worked to balance a 2013 budget.

In the end, Hanover approved a $30 million budget - including the tax hike - at a meeting last week.

The borough is using $1 million from its reserve fund to balance its 2013 budget, leaving about $1.7 million in reserve, according to Barbara Krebs, Hanover's borough manager.

Hanover's tax rate now stands at 5 mills, bringing its tax rate closer to those of comparable boroughs like West York and North York with rates of 6.5 and 6 mills, respectively.

The 5-mill rate means a borough property tax bill of $750 for the owner of a $150,000 home.

In November, borough officials had originally proposed a 38 percent tax hike.

Since then, newer estimates have worked out in the borough's favor. Expenses are projected to come in slightly lower, and revenue is projected to come in slightly higher, Krebs said.

The borough also finished 2012 about $400,000 under budget. That's cash that can be carried into 2013, Krebs said.

- Erin James may also be reached at ejames@yorkdispatch.com.