PORTERDALE — The City Council is expected to vote on a proposed 4-mill property tax increase that city officials say is needed to close a revenue gap of $110,000 and compensate for decreased property values.
The City Council approved a calendar year budget of $945,000 in December, which was based on a proposed 3.5-mill increase. Since that time, it has become apparent that the $945,000 budget did not include some necessary expenditures and cost increases, nor did it take into account a 32.27 percent decrease in assessed property values that the city has experienced.
Porterdale's current millage rate is 9.156. The proposed millage increase would be in addition to Porterdale's rollback millage rate, which is 13.518, meaning that, if the 4-mill increase is approved, Porterdale's millage would be 17.518. That millage is expected to generate $299,134 in property tax revenue. The rollback rate is the millage that would be needed to generate the same amount of tax revenue as the previous year.
At 17.518 mills, the tax impact for an average Porterdale residential property would be approximately $40 to $60 per year, according to City Clerk Judy Johnson.
The majority of Porterdale's residences are rental properties. Owner-occupied homes could be eligible for a $10,000 homestead exemption for the first time this year if voters approve the measure in a local referendum.
Three public hearings will be held in advance of the vote in order to get public input on the tax increase. The first is scheduled for Wednesday, July 30, at 6 p.m., followed by meetings Thursday, July 31, at 6:30 p.m., and Monday, July 12, at 6 p.m., immediately preceding the council's regular meeting at 6:30 p.m. All meetings will take place at City Hall.
In addition, the council will have a public hearing on amendments to the current year budget at the July 31 meeting. The amended budget totals $1,055,725 in revenues and $1,049,207 in expenditures and is based on the 17.518 millage rate.
Amendments to the budget include anticipated property tax collections of $299,134, as opposed to the previously budgeted $344,000, and a $10,000 increase in local option sales tax collections.
The amended budget also calls for an increase of $102,000 in expenditures for the Porterdale Police Department. The majority of the increase is tied to expenditures that were either not budgeted last year or were budgeted under the wrong line-item.