A final decision to ask voters to approve a higher tax rate to cover a budget that's expected to come up about $1 million dollars short for at least the next three years remained at the committee level Monday, but will almost certainly be OK'd and sent to the city council for approval next month.
The finance committee postponed a decision until it receives more detailed information about future expenses for needs such as road repairs, equipment replacement and other city services.
The committee, which will send its recommendation to the city council for approval before the issue can be put on the ballot, also is asking to see various budget scenarios based on different amounts of millage assessments.
The millage rate determines how much property owners pay in taxes. The committee will meet Jan. 30 and expects to have a recommendation to the council for a February meeting.
Whatever the recommendation the committee makes, it is certain that the vote will be in November at the same time as the general election.
The committee, chaired by councilman Todd McConaghy and made up of Mayor Robert Novitke and first-term councilman Michael Koester, agreed that , but it could not agree on how much to ask for.
The decision was delayed after Koester requested further financial breakdown of revenue and expenses.
"I think this idea needs to be much more fleshed out….We need to get list of needs, expenses, how much what costs per year," Koester said during the meeting that drew four residents, a rarity at finance committee meetings.
The amount voters will be asked to approve is likely to be between 3 and 5 mills. To seek that amount Woods voters must OK an override of the Headlee Amendment, which in part requires tax rates be rolled back if state equalized property values (about half of market value) are greater than the rate of inflation.
The tax rate in the Woods has dropped below the maximum allowed of 20 mills to between 14 and 15 mills, and the city will ask voters to return to or near the 20-mill level.
A mill equals about $600,000 in revenue for the city. For a property owner, a mill is equal to 1/1000th of a dollar so for every $1,000 of taxable value a property owners pays $1 in property tax.
The council can approve a 0.4 mill increase without voter approval, but that amount won't come close to covering city expenses and won't give the city the bond rating it needs to borrow money for repair roads, repairs that have been delayed for at least three years, City Treasurer and Comptroller Dee Ann Irby told the finance committee.
Whatever the outcome, Woods voters will still be paying less in taxes than they did in 2008 because property values--and thus property taxes--have dropped every year since then.
She said the city received good news, however, after completing a more detailed report of home sales. It showed that property values will not drop to the anticipated 7 percent next year. Instead the decrease may be closer to 3 percent, she said.
"Although that's good news we're still looking for money…We still anticipate a shortfall," she said.
If the council chose to go only with the minimum 0.4 request the city would no doubt have to choose city services to do away with or decrease: leaf pickup, public safety, snow removal, park hours, etc.
"We'll still be $900,000 short in 2012-13," Irby said.
The upcoming budget includes no spending for road construction unless more revenue is generated by a millage increase.
"I'm very concerned. The longer we wait with the roads, the more they deteriorate," McConaghy said. "It's not just roads. It's police officers. It's public safety."
Koester said it's a tough decision.
"No one likes paying more, I don't want to pay more, but…you live in this town, you like this town, it's about 50 years old and everyone realizes it it's cost to keep it up. We need to take our lumps right now and say we're a great community and lay out there to keep it that way."
Novitke said the millage increase is the only solution.
"No matter what we all do we know you need to address the revenue end of this," he said. "We've done everything on the expense end…If we're going to do something on this. we better start real real soon. How do you present it so residents really truly understand it."