Council argues, lowers tax rate

By Racey Burden | Published Published Saturday, Aug. 19, 2017
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After some argument, Boyd City Council members voted Tuesday to propose a tax rate of 55.4 cents per $100 valuation, 6 cents lower than last year’s rate.

Mayor Rodney Holmes wanted the 55.4 rate, which is the rate the staff based its original proposed budget on. It also drafted budgets for rates of 59.9 cents and 61.9 cents, the 2016-2017 rate.

Council member Mark Culpepper said he’d rather keep the rate at 61.9 cents and use the extra revenue to work on city projects.

“We have an opportunity to take a step forward here,” Culpepper said. “We’re missing out on that.”

Holmes said he didn’t feel like it was right to raise taxes when the city is already considering calling a bond in the near future.

City Administrator Greg Arrington explained to the council any rate over 55.4 could put the city in the position of having to hold a rollback election, in which the citizens could vote to lower their taxes to the rollback rate. If the council chose to propose a higher rate, Arrington said they would have to keep any revenue raised over the rollback rate in escrow until the window for a rollback election passed, at which he would advise using those funds on the first phase of Boyd’s capitol improvement plan.

Arrington said keeping the 2016-2017 tax rate would mean an extra $62,000 in revenue, and the 59.9 rate would earn an extra $40,000. If the city chose to go with 55.4 cents they would see $37,000 less than last year, Arrington said.

“I want the city to at least break even,” council member Tim Hammons said.

Holmes said the city’s projected sales tax, around $80,000, would cover the losses caused by a lower tax rate. He added that even with increased property values, citizens should get a tax break with the 55.4 rate.

“We need to show that we are self-sustaining,” Holmes said. “It would be nice to have that extra money, but if we can give back a little bit, we need to do that.”

Councilman Vince Estel pointed out some of the current council members criticized past councils for lowering taxes and neglecting needed projects for lack of funds.

When Culpepper made a motion to keep the rate at 61.9 cents, Estel seconded the motion. It was shot down, with Letty Thome, Hammons and Gary Brown voting against it.

Thome, Hammons and Brown voted in favor of proposing a rate of 55.4 cents. Estel and Culpepper voted against the motion, but it passed 3-2.

The council also:
* approved the fiscal year 2015-2016 audit;
* voted to approve a letter of recommendation from the city’s capital improvements advisory committee;
* set a public hearing for Tuesday, Sept. 19, to discuss land use assumptions, capital improvement plans and water and sewer impact fees; and
* discussed Community Center rental policy and fees.

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