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101 indication that the City is willing to fund safety issues such as sidewalks, CDBG funds would not be recommended for those purposes. Mr. Toscano said if Council wants to change the rules, they should change them prior to next year's CDBG discussions, not in the middle of the process. Mr. Cox suggested that the additional $200,000 for sidewalks recommended by Council be reprogrammed for the Ridge Street neighborhood. Ms. Richards noted that the grid for sidewalk priorities includes CDBG target neighborhoods and public safety issues. Mr. Toscano suggested that the Planning Commission be asked to discuss the issue. Ms. Richards questioned why the CDBG Task Force recommended more funding than was requested for the downpayment and closing cost program, and Ms. Grant said that they were trying to balance funds between the CDBG and HOME programs. ORDINANCE: ANNUAL TAX RATE Mr. Cox said Ms. Biasioli's presentation was quite compelling and that the real estate assessment can be viewed as a hidden tax. Mr. Cox said he is comfortable maintaining the current tax rate if the surplus is reinvested in things people think are important and where they can tangibly see a difference in improving City services and meeting unmet needs. Mr. Caravati said he views a reduction in the tax rate as a strategic investment and needs will always be great and unmet. Mr. Caravati said reducing the tax rate would reward citizens and encourage people and commercial investment moving back in the City. Mr. Caravati said he thinks the City can sustain a 2 cent to 3 cent cut in the tax rate over the next three years. Ms. Daugherty said she feels the large surplus is an unusual situation and future Councils should not be burdened with having to consider a tax increase. Ms. Daugherty said she would like to see the surplus go toward improving neighborhoods. Ms. Richards said she too is concerned about committing future Councils to having to deal with a tax increase. Ms. Richards noted that much of the surplus is due to a good building environment and she would rather wait to see if it is sustained for another year. Ms. Richards noted that the State has power over local taxing levels and changes are being or have been made in taxes, such as the personal property tax, meals tax and sales tax, that may cause the City to lose revenues. Mr. Richards said that the surplus is due not only to a good economy, but to the sale of the Omni Hotel, lottery profits for education, and House Bill 599 which provides funds for police, but these State funds may not be replicated in the long term. Ms. Richards said she is very reluctant to reduce the tax rate at this time, but would like to revisit the issue in another year when the above factors are not present. Ms. Richards said that if funds are returned, she would rather do it as a one-time thing. Mr. Toscano said he has struggled with this issue since December and he does not think there has been enough public discussion of it. Mr. Toscano said that the larger number of persons commentLng have said that they favor reinvesting the money and few have said that taxes should be cut. Mr: Toscano said the question is how sustainable is a tax cut, noting that the City has had three years of a surplus of over $1 million. Mr. Toscano said he does not feel a 2 cent tax cut will have an impact on the City's future, but he does not think the votes are there for a tax cut or rebate. On motion by Ms. Daugherty, seconded by Ms. Richards, the ordinance entitled "AN ORDINANCE TO ESTABLISH THE ANNUAL TAX LEVY ON VgavdOUS CLASSES OF PROPERTY FOR T HE PAYMENT OF INTEREST Al,ID RETIREMENT OF THE CITY DEBT, FOR THE SUPPORT OF T HE CITY