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City rejects proposal for lower taxes
Plan called for 10-cent property tax decrease
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McMinnville officials rejected a proposed 10-cent property tax decrease Tuesday night. If the measure remains unchanged, the tax rate for the upcoming fiscal year will be set at the current rate of $2.09.
Board members had two proposed budgets presented to them, one leaving the tax rate at $2.09 and resulting in an ending fund balance of $3.1 million in June 2015, and one with a proposed tax rate decrease of 10 cents resulting in an ending fund balance of $2.9 million.
“I make a motion we go with $2.09,” said Alderman Rick Barnes.
The motion passed 4-2. Voting in favor were Mayor Jimmy Haley, Vice Mayor Ben Newman and Aldermen Billy Wood and Barnes, while voting against were Aldermen Mike Neal and Jimmy Bonner. Alderman Ken Smith was absent.
Before accepting the budget, a failed motion by Neal to amend it and Bonner’s agreement with that attempt could have been the deciding factor for the two votes against it.
Neal’s motioned was to remove two items from the proposed budget that were added during a Parks and Recreation Committee meeting Aug. 5 – those being $40,000 to buy and install 250 fixed seats for Park Threatre and $80,000 to renovate the office area in Park Theatre.
Neal, who is on neither committee, says those items went through the wrong committee.
“It’s my understanding that anything to do with the actual building would be a Building and Grounds issue and not a Parks and Recreation issue,” said Neal. “So, we have two items that have been added to this budget but they did not go through proper channels.”
Park Theatre is a division under McMinnville Parks and Recreation. While the department’s budget is under the authority of the Parks and Recreation Committee, the Building and Grounds Committee is responsible for all maintenance and repair of city-owned property.
“We had already approved Park Theatre’s budget,” said Neal. “This came later and should have gone through the Building and Grounds Committee. If you read the city’s code, it says all maintenance and repair falls under Building and Grounds.”
Bonner, a member of the Building and Grounds Committee, voiced his agreement with Neal, while Newman, who is a member of both committees, disagreed stating that the item’s cost had to be added to the budget, an area under the authority of the Parks and Recreation Committee.
Neal’s motioned to remove the items failed 4-2. Voting against removal were Haley, Newman, Wood and Barnes, while in favor of removal were Neal and Bonner.
Wood, who would later vote in favor of the budget, made a motion to allocate $200,000 a year into the Street Aid budget to continue paving city streets. The motion failed due to lack of a second, with Wood urging, “Come on guys. We are putting streetlights back up. Let’s not illuminate potholes.”
In the midst of the discussion, Neal suggested the city could reduce the tax rate and keep $200,000 in the budget by asking department heads to reduce their budgets by 1.7 percent.
“There is a way we can do a tax reduction and keep an extra $200,000 in the budget,” said Neal. “That’s merely by taking these budgets back to the various departments and asking each one of them to cut 1.7 percent from their budget. We would still have tax relief for the citizens and would leave $200,000 in the budget for us to work with. I think 1.7 percent is a miniscule amount.”
Haley reminded the board that the state puts a deadline of Aug. 31 on setting budgets.
“If we do this, we would have to have several committee meetings from now to the end of the week and early next week,” said Haley. “Each committee would have to meet. You can’t ask each department to redo their budgets and resubmit them.”
Passing a budget takes two readings before the full board. After first read, the city has to post the proposed budget in the newspaper 10 days prior to second and final reading. Rescheduling all committee meetings to approve the amended budgets might push the city past the Aug. 31 deadline.
“I asked earlier today if there is any penalty if we don’t have it by Aug. 31,” said Neal. “I don’t think anyone has the answer to that. I’m like Mr. Barnes, I don’t think they will put us in political jail if we are a few days late. I think this is a worthwhile gesture. It shows we are willing to work together and compromise, which is something I think the public is asking for.”
Haley says the city’s delay will affect the county in that the property tax notification cards for the city and county have to be printed at the same time and the county has already set its budget for the upcoming fiscal year.
Neal’s suggestion was not in the form of a motion and no vote was taken.
The second and final vote on the proposed budget for fiscal year 2014-15 is scheduled for Aug. 26.