City to raise millage, water rates

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Property tax may go from 4.75 to 6.2713 mills

By Lou Elliott Jones, Editor

The City of Chiefland, wrestling with financial woes, has decided to tentatively raise the property tax millage for the first time since 2008 and to raise base water rates for the first time in three years.

The City Commissioners voted 3-1, with Mayor Teal Pomeroy voting no, to tentatively raise the city property tax from 4.75 mills to 6.2713 mills. If adopted, the new millage would raise $789,097 in revenue for the city. The current millage raised only $611,264 for the current year. 

A mill is equivalent to $1 tax per $1,000 value, so property taxes could increase from $4.75 per $1,000 of value to $6.2713 per $1,000 of value. In a presentation to the commission, City Manager Kevin Gay said the tentative millage “will create revenue in which we can operate.”  Gay had suggested three possible millage rates, including the maximum of 6.8984 and the lowest of 6.1671. All, he said, would generate contingency funds which if no emergencies arose— like renovating City Hall due to a black mold problem earlier this year — could yield funds for the city's savings account at the end of the year. 

In contrast, the 4.75 millage would only raise $597,677 and the city would have to cut spending by $97,561.79, Gay said. 

The tentative millage, which will go out on TRIM notices in mid-August, can be lowered by the commission before adopting the final budget for the fiscal year that begins Oct. 1. Monday's action in a budget workshop simply means that is the maximum that taxpayers can expect to be charged. 

The city first adopted the 4.75 millage in 2008 when city property was valued at $154,261,324, since that time property values have fallen to $127,681,134 last year while the millage held and revenues dropped.

On the water rate increase, Gay said the city commission adopted a three-tiered increase plan in fiscal year 2010-11, but never adopted the resolution to put the third tier increase in effect. He asked them to do so and the commission, after some discussion, directed the staff to draw up the resolution to increase residential rates from a base rate of $8.18 to $8.50, and increase the usage charge:

• from $2.57 per 1,000 gallons for the first 6,000 gallons to $2.91

• from $2.72 to $3.06 per 1,000 for the next 3,000 gallons

• from $2.97 to $3.31 per thousand for 9,000 to 15,000 gallons used, and 

• from $3.22 to $3.56 for each 1,000 gallons over 15,000.

The commercial rates would rise from a base of $12.68 to $13,00 with usage going:

• from $2.72 per 1,000 gallons for the first 6,000 gallons to $3.08

• $3.07 to $3.43 per 1,000 for 6,000 to 9,000

• $3.42 to $3.78 per 1,000 for 9,000 to 15,000 gallons and

• $3.72 to $4.08 per $1,000 for more than 15,000 gallons.

Under the proposal city water revenues would go from $149,469 to $162,504 for residential service and from $203,625 to $220,773 for commercial accounts.  

In budget cuts, the city is replacing its “door knocker” program where an employee visits residents with overdue bills to remind them with a software program that will call them. The program can also be used to notify city residents of emergencies and to distribute notices fromt eh city. On Monday, the commission voted unanimously to purchase the software for $2,245 and save the $5,000 it spends annually on the current program. It will also apply for a grant that could pay for a large portion of the software. 

Gay also told the commission he closed the city dump to commercial interests, allowing only residents to drop yard debris at the facility. He has estimated that will save the city $5,600. Businesses that have been using the city dump must now use the county landfill south of Bronson, 

The city manager is also asking to close City Hall and maintenance facilities on Fridays to save on utilities. He said the annual savings for closing City Hall alone is $1,567. 



In other financial news, the commission's insurance agent, Michael Michaelis said Blue Cross Blue Shield had proposed a 19 percent increase in health insurance premiums for city employees, but he negotiated it to 12.5 percent and the final figure worked out by both sides is 6.5 percent with an increase in the prescription co-pays. The increase will cost the city $15,051.21.

One concern was that the city would lose a discount if it fell out of the “large group” tier of coverage, but Michaelis said with 51 employees the city maintained its status. 

He also warned the commission that next year health insurance rates “are going up 25-30 percent across the board.”

Gay said, “The city doesn't have a whole lot to offer in wages so we went with the optimal program that we could. Unfortunately it is going to hit some employees in the pocketbook.”

The city will hold public hearings on the proposed budget on Sept. 9 and Sept. 23 at 6 p.m. Adoption of the final budget will be at the Sept. 23 meeting. 

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