ROSWELL, Ga. — The Roswell City Council formally adopted a tax rate Aug. 31 that remains the same as last year.
The vote to keep the rate at 4.955 mills was 4-3, the same split as at the first two meetings the issue went up for vote.
Even after settling a battle to lower the rate, Roswell officials will have to make up for an anticipated half-million-dollar shortfall in its current operating budget that it adopted in June.
City officials held two public hearings earlier in August 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 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. The city had anticipated a rise in that digest.
Overall, the city expects to pull in just above $25 million in property tax revenues. That’s about a 2 percent drop from last year, according to Finance Director Ryan Luckett.
Based on continuing the tax rate at 4.955 mills, this 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.
Luckett said his staff is in the process of drafting plans on how the city can adjust its spending or revenue to bring everything in line.
Another wild card in the mix is how many property owners will appeal their tax assessments this year. In 2019, the city garnered 1,425 appeals on property values. So far, 80 percent of those appeals have been resolved. About half of them resulted in lowered values, meaning the city received less money than it anticipated in those cases.
The deadline for 2020 assessment appeals ended Aug. 27, and so far, the city has not received information about the number, Luckett said.
The council debate over the millage rate, in part, centered on whether the average resident will see a bigger tax bill this year. The city is required to calculate a “rollback” millage rate intended to adjust for properties reassessed this year with higher taxable value. The rollback rate of 4.685 mills would assure, on average, these property owners would pay the same city taxes as last year. It would also bring in less money to the city.
Councilman Mike Palermo, repeated arguments made at the prior two public hearings, voted against the higher mill rate saying it amounts to a tax increase on homeowners.
“I’m opposed to this tax increase on our homeowners,” he said. “There are many cuts that should have been made to this budget. This was especially the year not to be spending so much taxpayer money on things that don’t benefit taxpayers.”
Councilman Matthew Tyser countered that maintaining the same tax rate could prove crucial in compensating for the revenue losses destined to come with 2020 assessment appeals. Even now, he said, last year’s budget surplus of $70,000 is almost all eaten away by appeals, and not all appeals have been resolved.
Councilman Matt Judy said maintaining the current tax levy is the only way to ensure residents stay safe, the city runs efficiently and its employees remain employed.
That point was seconded by Councilwoman Marie Willsey, who said the budget has already been trimmed by $11 million, and many capital projects needed for the future have been placed on hold.
Mayor Lori Henry provided the fourth and deciding vote, stating that the proposed 2021 budget does not increase the number of employees or provide raises to current employees. She also stressed that since the budget was first drafted in the early part of this year, more than $25 million in proposed spending has been slashed or delayed.
“What I am presenting to you is a budget that will get us through COVID-19, God willing, and that we will reassess on a quarterly basis,” she said.
Council members Marcelo Zapata and Christine Hall joined Palermo voting against the levy.