2004-12-06 - Laserfiche WebLink

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positive fund balance; and 19) Analyze service level reductions (5% and 10%) in City operational and outside agency budgets. Dr. Brown suggested that Councilors withdraw guidelines to be discussed separately and that those remaining be approved together. Mr. Schilling withdrew guidelines #1, 2, 4, 7, and 15. Mr. Lynch withdrew guidelines #13 and 19. Mr. Caravati withdrew guideline #8. On motion by Mr. Caravati, seconded by Mr. Lynch, guidelines #3, 5, 6, 9, 10, 11, 12, 14, 16, 17 and 18 as listed above were approved by the following vote. Ayes: Dr. Brown, Mr. Caravati, Ms. Hamilton, Mr. Lynch, Mr. Schilling. Noes: None. Mr. Schilling said he agrees with guideline #1, but does not think it goes far enough. He said he would like to see a decrease in the real estate tax rate. He asked if the preliminary assessment increases are known. Mr. O'Connell said that we will have specific numbers in January. Mr. Lynch said he understands that we expect a little over 11% increase in assessments. He proposed limiting growth in individual assessments to 5% and capping the overall increase at 7% which would take the rate to $1.05. He said, with regard to the projected shortfall in personal property tax revenues, we have the ability to raise taxes on vehicles and he proposed we do that. He said he does not think it is a healthy trend to reduce the tax for automobiles and increase the real estate taxes. Ms. Hamilton said her current car tax bill is $36.00 and she said she could afford to pay more than that. Ms. Hamilton asked what the difference would be in the car tax if the real estate rate was rolled back by one cent and the revenue remained the same. He said the difficulty this year is a $1.2 million to $1.5 million reduction this year in the car tax revenue and the possibility of another $1.5 million reduction due to the repayment schedule to localities. Dr. Brown said that Mr. Lynch brings up an interesting idea but he feels there are too many questions to consider it now, such as how much it would have to go up. He said more information is needed. He asked the City Manager to prepare two different ways to look at the budget: 1) no increase in the tax rate and 2) budgets with a two cent decrease in the real estate tax rate. He said we can then see where the choices lie and address true needs. Mr. Lynch said that in addition he would like to look at a four cent reduction in the real estate tax rate which would be the same as a 5% cap. He said we could be revenue neutral with a car tax increase. Mr. Caravati asked staff to develop a clearer analysis on the car tax. He noted that this would affect businesses that own other personal property, not just automobiles. He questioned which tax would be more regressive. He concurred at preparing budgets with a two cent decrease. He reminded Councilors about guideline # 19 which is significant. Dr. Brown suggested adding to guideline #1 to consider a two cent decrease in the real estate tax rate. Mr. Lynch said he would support this, but feels we should also look at increasing the car tax to get to a four cent reduction. Mr. O'Connell said that a four cent reduction is significant when combined with the expected decrease in car tax revenues.