PORTERDALE -- City Council members heard the first and second readings of the city's 2010 budget ordinance at a called meeting Thursday night. The proposed budget, which will go before the council for a vote on Dec. 7, calls for a 3.5-mill increase in the city's millage rate.
City Manager Tom Fox had told council members at a work session earlier this month that the proposed millage increase would be necessary if the council wants to avoid layoffs, furloughs or cuts in services to city residents.
Fox said the council may go ahead and approve the budget as proposed, but it won't be necessary to set the millage rate until the spring of next year. He said the city's plan is to monitor revenues and expenses in the intervening months to determine if it will be necessary to increase the millage and, if so, how much.
"In reference to the millage rate, assuming that we don't have any economic recovery, so to speak, or any changes as far as increases in revenues ... then, yes, we would need to raise our millage rate the 3.5 mills in order to make the budget balance," Fox said.
Fox is proposing a $944,000 budget for 2010, with $344,000 coming from property taxes. Local option sales taxes are expected to make up $195,000 of revenue, and insurance premium taxes contribute an estimated $71,000.
Employee costs make up the majority of the town's expenses, with $560,000 -- or about 59 percent -- going toward salaries, benefits and workers compensation insurance.
Fox is also recommending that the city pursue a homestead tax exemption for 2010 for Porterdale homeowners to reduce the impact of any millage increase on homeowners. The exemption would have to gain legislative approval in the upcoming session of the General Assembly and then be approved by Porterdale voters.