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Council approves 2013-14 budget

Wednesday, May 15, 2013

By MICKEY POWELL AND PAUL COLLINS - Bulletin Staff Writers

Martinsville City Council on Tuesday night approved, on first reading, a fiscal year 2013-14 budget that city officials have described as basically revenue neutral.

Danny Turner was the only member of council to vote no after he made or attempted to make several motions to reduce spending.

The real estate tax rate is proposed to increase from $1.01816 to $1.0621 — almost 4.4 cents — per $100 of assessed property value.

That means the tax bill for a home assessed at $100,000 would increase by $43.94, from $1,018.16 to $1,062.10.

The rate hike does not necessarily mean that real estate owners would pay more in taxes.

A recent citywide reassessment resulted in an average decline in real estate values of 4.14 percent. City Manager Leon Towarnicki has said that would cause the city to lose about $260,000 in tax revenue.

The proposed “equalization” rate hike would let the city basically continue taking in the same amount of real estate tax revenue it now is receiving.

Whether residents and businesses see higher tax bills in the new fiscal year that will start July 1 would depend on whether their properties decreased in value, and by how much, officials have said.

The vehicle tax rate is to remain at $2.30 per $100 of assessed value. The rate for manufacturing machinery and tools is to remain at $1.85 per $100.

No water, sewer or electric rate hikes are part of the spending plan, which would raise the monthly residential garbage collection fee from $16.25 to $18.50. The fee for emptying large, business-type trash containers would jump from $24.50 to $26 each time one is emptied.

Businesses without such containers would pay twice the residential rate for twice-weekly garbage collection, according to the budget proposal.

Expenditures in the proposed budget total $88,698,746 while revenues total $84,638,852. The difference of $4,059,894 would be made up from transfers from utility funds — profits from which go to support city services — and reserve funds, said city Finance Director Linda Conover.

The proposed budget ordinance shows the city is expected to have about $13.3 million in its fund balance, including reserve funds, when fiscal 2014 ends in June of that year.

However, Conover said she could not yet determine exactly how much in reserve funds would be used toward balancing the budget.

The city schools are set to receive $6,360,531, the amount of local funding they sought. The proposed budget had included $6,013,985 for the schools, but the council recently voted to give them the higher amount to help them hire new employees and meet the state Standards of Quality, among other things.

During council’s public hearing on the proposed budget Tuesday night, representatives of Blue Ridge Regional Airport asked the city to increase funding for the airport in the proposed budget from $8,100 to $20,000. They talked about the airport’s economic impact on the area as well as its need for funding for such things as maintenance projects.

Afterward, Vice Mayor Gene Teague made a motion that funding for the airport be increased by $900 to a total of $9,000, which he said would mean that local funding for the airport would be about 25 percent city and about 75 percent county. Council unanimously approved the motion.

Also during the public hearing, Ural Harris spoke against raising the real estate tax rate and certain fees.

“Y’all need to live within your means because citizens have to. If you can’t balance the budget, you need to resign,” Harris told council. Applause from the audience followed.

Three parents and city schools Superintendent Pam Heath thanked council for fully funding the school division’s budget request.

Parent Bill Kirby, who has a child who is a student at Patrick Henry Elementary, said he is “constantly impressed” by the school. Kirby, who also is president of the Martinsville City Public Schools Endowment Fund, said he has been impressed by what he has seen at other city schools as well.

“Thank you for supporting our schools,” Heath said, and she pledged the school division will be a responsible steward of the money.

Heath asked if council could approve an agreement Tuesday night that it would fully fund the school board’s budget request so that the school division can issue contracts. City officials said that hadn’t been done before and that for the time being, approval of the city budget on first reading will have to suffice.

Also at the meeting, Turner made three motions to reduce city spending that died for lack of a second: eliminating the assistant city manager and budget analyst positions (two motions) and eliminating funding for the Southside Business Technology Center. He attempted to make a motion to cut city funding for the Martinsville-Henry County Economic Development Corp. to $100,000, but that motion was not allowed because council previously voted on the matter. The proposed budget includes $279,500 for the EDC, the same amount it received for the current fiscal year.

Turner also asked if the city is obligated to fund $1.7 million for Commonwealth Crossing Business Development Center. City Attorney Eric Monday said the city is contractually obligated.

The budget will come back to council for a second vote.

 

 
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