ROSWELL, Ga. — The Roswell City Council is being tasked to make up for a half-million-dollar shortfall in its current operating budget that it adopted in June.
City officials held two hearings last week to discuss the property tax rate. Both times, the proposal to keep the mill levy at 4.955 mills, the same level as the past two years, won a slim majority of support.
While the city’s tax digest — the value of all property within the city — is estimated to increase by 1.3 percent this year, so have the number of new and existing homestead exemptions. The tax breaks have lowered the city’s assessed value on property by $661 million, saving residents some $3.3 million in taxes, or about $114 per household.
In addition, the city’s commercial property took a hit in value, falling about 3.4 percent, or some $54 million in value.
All combined, that leaves the city short some $500,000 in tax revenues it expected to take in when the budget was adopted more than two months ago.
Roswell operates on a fiscal year that runs from July 1 to June 30.
Finance Director Ryan Luckett said his staff is working on recommendations to propose that will bring spending in line with the newly revised revenue estimates, either through cuts in spending or additional revenues from other sources.
Councilman Mike Palermo voted against the tax levy saying it amounts to a tax increase on homeowners.
“There are many cuts that should have been made to this budget,” Palermo said. “This was especially the year not to be spending so much taxpayer money on things that don’t benefit taxpayers.”
If the city is committed to keeping taxes the same as last year, Palermo said, the council would lower the tax rate on property to 4.685 mills.
Luckett estimated that the proposal for a lower mill rate would add another $100,000 to the budget shortfall.
Mayor Lori Henry said that having been intimately involved with the budget, she felt comfortable that all avenues of cost savings were considered.
“However, there’s always room to improve,” she said. “So, going forward, I am always open to looking at additional cost savings and the possibility of diving deeper into our budget.”
Henry said the city already faced a $500,000 deficit when the budget was approved in June. The council voted to make up that deficit through a transfer from its unassigned capital projects fund.
“Running our operating budget off of the unassigned [capital] fund balance is not a good practice,” Henry said. “I firmly believe that money needs to be paid back into that fund.”
Right now, the mayor said, the city has not even had its first budget review. Nor does the city know how tax appeals will turn out. Already, Henry said, the city has taken steps to suspend employee raises, reduce spending for road maintenance and other cost-cutting measures.
The mayor said that in the meantime, she supports the budget as it stands.
She said it would not be responsible or prudent to roll back the tax rate at this time.
The council currently stands at 4-3 in favor of the current proposal. Council members Palermo, Marcelo Zapata and Christine Hall were opposed.