Porterdale approves budget with millage increase

PORTERDALE -- The City Council approved a $945,000 budget Monday that reflects a 3.5-mill increase necessary to make up a $94,000 shortfall in revenue.

The council approved the 2010 budget by a 4-1 vote, with Councilwoman Linda Finger opposed. "Absolutely not," said Finger when Mayor Bobby Hamby polled each council member for a vote on the measure.

Finger was angered that she had not received a copy of the proposed budget early enough for her to review it. In addition, she said she had asked City Manager Tom Fox for a draft of the budget that did not include the proposed millage rate increase, and she had not received it.

Fox explained that the city had experienced multiple computer problems at City Hall that had delayed distribution of the proposed budget until Sunday at 6 p.m. Finger said she was away from home and did not get her copy until she returned at midnight.

Finger, who has repeatedly expressed her opposition to a tax increase for property owners, said she thinks the city should find solutions to the revenue shortage other than layoffs, rate hikes or tax increases.

"The budget before us is what it will take to maintain the services that our citizens are receiving today," said Mayor Hamby, adding that the city is already short-staffed. Approval of the budget does not include approval of the millage increase, he added, noting that the city can determine later in the spring if the full 3.5-mill increase is needed.

Porterdale's current millage rate is 9.156 mills, which is expected to generate $249,492 in property tax revenue based on a tax digest of $27 million.

The proposed millage increase would generate another $95,372, a 38 percent increase in property tax revenue. On a home valued at $100,000, the city tax bill would increase $140 a year.

Porterdale avoided a tax increase last year by selling its excess sewage treatment capacity to the Newton County Water and Sewerage Authority. The town's ongoing revenue shortfall is attributed to the loss of water fund transfers to the general fund.

In an effort to mitigate the impact of a millage increase on property owners, Porterdale plans to pursue passage of a homestead tax exemption in the General Assembly in the upcoming session. The exemption would have to be approved by Porterdale voters in a local referendum.

Fox proposed two scenarios showing that a $5,000 homestead exemption would save the owner of a $100,000 home $63.28; with a $10,000 exemption, the owner of the same home would save $126.56. Fox said a homestead exemption would have a minimal effect on city tax revenues.