City gives tentative approval to 5.6% property tax rate hike

Published: Tuesday, July 24, 2012 at 9:05 p.m.
Last Modified: Tuesday, July 24, 2012 at 9:05 p.m.

The City Commission gave tentative approval Tuesday to an approximately $105 million general government budget that increased the property tax rate by about 5.6 percent.

Following the vote, the city will advertise a property tax rate of 4.496 mills, up from this year's rate of 4.2544 mills.

One mill equals one dollar of tax for every $1,000 of taxable property value.

The increase in the property tax rate comes with taxable property values declining by some 4.4 percent

The city's total projected property tax revenues would rise from $22.13 million, the updated projected total for this fiscal year, to $22.45 million.

The vote on the tax rate and tentative budget passed 6-1, with Commissioner Todd Chase in dissent.

While the tax rate increases and the total property tax revenues increase, the decision will, under state criteria, be advertised as a tax decrease for the city's general fund when the Truth in Millage notices are mailed to property owners.

Administrative Services Director Becky Roundtree said that is because, after new construction and the property tax revenues that go into the Community Redevelopment Agency district budgets are taken into account, the tax rate would raise less money for the general fund from the properties that were on the rolls for this fiscal year.

In response to a question from Mayor Craig Lowe, Roundtree said the city would be required by state law to advertise it as a tax decrease.

Reiterating his comments from a budget meeting last week, Commissioner Chase said that, no matter what a state requirement dictates, it was unrealistic to describe the decision as a tax decrease.

Commissioner Thomas Hawkins said when it comes to property tax rates, Gainesville stacks up favorably among the nine municipalities in Alachua County. Only two municipalities -- Newberry and LaCrosse -- have lower tax rates, Hawkins noted, and neither has a police department to fund.

"I appreciate Commissioner Hawkins' comments and I would add as a caveat, thank God we have GRU," Chase said.

The transfer of funds from Gainesville Regional Utilities to the city's general fund for next fiscal year is approximately $36.67 million and exceeds property tax revenues by some 63 percent.

The city budget includes a 2 percent pay increase for employees, no layoffs and no major increases or decreases in spending for any departments.

Public hearings on the formal adoption of the budget will come in September.

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