Editor’s Note: There’s a lot more to this meeting than can be effectively captured by a daily news piece. We strongly recommend that readers take advantage of HiH video and watch the meeting in its entirety.
All members of the Henderson City Council with the exception of Ward 1’s Mary Emma Evans agreed at the seventh budget session held yesterday to increase the ad valorum property tax by one cent on each hundred dollars of valuation.
The move will raise the Henderson property tax rate from 56.5 cents on the 57.5 cents per hundred dollars of valuation.
This year’s budget follows a trend from last year’s budget when a tax hike of 1.5 cents was levied on Henderson property owners. At the time the fiscal year 2009 budget was announced, Council member Mike Inscoe emphasized that city employees would receive a 3% cost-of-living raise along with an average 2.5% merit raise.
Employees received the 3% COLA adjustment, but the council recently voted to eliminate the merit raises, giving the current economic climate as a reason.
This year’s tax hike, according to council consensus, will go primarily towards shoring up the fund balance, with $16,200 going towards unanticipated debt service due in December. The city had originally planned to refinance the building housing the Henderson Police Department as well as the Aycock Recreation Complex to save the $16,200, but changes in interest rates forced the city to temporarily suspend that move, creating a budget shortfall.
Although yesterday’s budget session was held to consider citizen remarks made during Monday’s public hearing on the city’s 2010 budget, members chose not to fill a frozen fire fighter position or continue the contract with Community Workforce Solutions that were the main focus of citizen concern at Monday’s meeting.
The idea of a one cent tax increase was first broached by Council member Mike Rainey. Member Garry Daeke later picked up on the idea, but wanted the increased revenue to go into the unrestricted fund balance. Council member Lonnie Davis called for an increase of 1.5 cents, with funds split between current operating expenses and the unrestricted general fund.
Inscoe voiced initial opposition to a tax increase, stating that taxes are driving small businesses out of Henderson. Member Bernard Alston agreed with Inscoe, stating, “I don’t think it’s the time to raise taxes in Henderson”. Both later suggested that they would be more comfortable with a tax increase if some or all of the increased revenue went towards the unrestricted fund balance.
Inscoe indicated that the vacancies in the budget could be addressed at a later time if the revenue situation improved.
Evans remained resolutely opposed to a tax increase, and stated an opposition to increases in water and sewer fees.
In a run-off voting procedure, the council initially agreed to leave the budget as it had been presented on Monday, with no increase in property taxes. However, in discussing how to find the $16,200 in unanticipated debt service, Daeke stated a need “to think about what we’re saying” and reconsider a tax increase.
Daeke noted as members considered the option that the Vance County Board of Commissioners had cut 1.5 cents off of their levy, thus moving the “surplus” from the county to the city.
Members had considered in that discussion cutting their pay by up to $50 a month. That, however, still left an approximate $11,000 shortfall. They were unwilling to part with the special projects manager or the part-time position of Downtown Development Director currently held by Phil LaKernick.