Going into Tuesday’s budget hearing, Statesboro city officials intend to leave the property tax millage rate unchanged but are proposing to increase water and sewer fees and charge a new fee when people pay their bills by credit card.
The 10 a.m. public hearing on the proposed fiscal year 2017 budget is slated to follow Tuesday’s regular 9 a.m. City Council meeting at City Hall.
The city’s proposed general fund for the budget year beginning July 1 has revenues and expenditures balanced at a little over $14.55 million, increasing from a little less than $14.1 million in the current year.
Meanwhile, with the proposed fee increase, the separate water and sewer fund shows projected operating revenues of almost $9.99 million for fiscal 2017, up from $9.45 million in the budget year now ending. With operating expenditures of $8.43 million, this is predicted to yield net income of almost $1.56 million. But the current budget’s water and sewer fund net income was only $211,000.
With the Special Purpose Local Option Sales Tax falling about 9 percent short of projections, and with much of the SPLOST money going to expansion projects, the city is having to dip into operating funds to pay for pipeline rehabilitation and repairs, said interim City Manager Robert Cheshire.
“We’ve got to generate some additional funds to pay for those, but we’re trying to do a very minimal increase, and we haven’t increased these particular rates since 2010,” he said Friday.
The staff’s proposal was a $2 increase in the base rate for every residential and commercial meter. On a residential account with a $6.50 base rate for water and $6.50 for sewer, the combined base rate would rise from $13 to $15. Industrial and governmental rates would remain the same, Cheshire said.
However, some City Council members have told him they would prefer an increase in usage rates instead of the base rate. The council held a budget workshop in April 22 where departmental requests were presented. But Cheshire said Friday afternoon that he has had recent conversations with individual council members and was still deciding what form his water and sewer fee recommendation will take.
‘Convenience fee’
He also intends to propose a 2 percent “convenience fee” for credit card payments on utility bills. The city of Statesboro has not charged such a fee. But the city surveyed 100 organizations, such as city and county governments and universities, he said, and found that more than 90 percent charge a fee for credit card payments.
Meanwhile, credit card processing charges and security are costing the city about $140,000 a year, Cheshire said. With the 2 percent fee, the city would recover about $80,000 to $85,000, if as many customers continue using credit cards.
On the expense side, most of the city’s 300 employees are getting raises because of the new pay plan City Council approved in April. The cost has been partly offset by not filling some vacancies and merging duties, and no millage increase will be needed to fund the raises, Cheshire says.
Would keep growth
However, he has not received tax digest information from the Bulloch County Tax Assessors office, and if the assessed value of taxable property within the city increases, Cheshire hopes to capture the increased revenue for the city.
“There won’t be a millage increase, but if for some reason the value goes up, we probably will still ask to keep the millage rate the same,” he said. “Theoretically, that in some cases would be considered a tax increase.”
If property value inflation is more than minimal, under Georgia law, a series of tax increase hearings will have to be held unless the millage rate is rolled back to compensate.
Because of one city fee increase already in effect, businesses that sell alcoholic beverages will be paying more for their licenses with the July 1 renewal. City Council adopted the increases rates for these in March to fund an alcoholic beverages control officer.
In addition to the general fund that receives tax money and the water and wastewater fund, the city has a separate natural gas fund and other funds, so that revenue and expenditures add up to more than $40 million a year.
No vote is scheduled for during or after the hearing. City Council is slated to adopt the budget and the fee schedule two weeks from now.
Herald reporter Al Hackle may be reached at (912) 489-9458.