Monday, August 19, 2013

Council raises tax rates slightly; majority says revenue base must be protected

The Midway City Council voted tonight to raise taxes slightly, to safeguard the city's future revenue base, after debating whether the small amount of extra money this year was worth the trouble.

The tax on real estate will be 10.6 cents per $100 of value, up from 10.5 cents for the last fiscal year. Personal property will be taxed at 18 cents, up from 16 cents, but the increase is estimated to generate only $214 more than the old rate because the value of personal property on the tax rolls declined this year, to $1,071,970 from last year's $1,205,484.

Woodford County Property Valuation Administrator Gary Gillis was at a loss to say why for sure, but told the Midway Messenger last week that some taxpayers were late in filing their personal-property returns by the May 15 deadline. Versailles reportedly had a similar phenomenon last year.

The value of real estate in Midway also declined, to $96,731,300, from last year's $97,241,400. When property value declines, taxing authorities can levy a compensating rate, which generates roughly the same amount of revenue. Tax rates have only one decimal place, so the amounts are only roughly equal. Based on property valuations, the compensating rate on real estate will generate $103,671, or $1,568 more than last year's $102,103.

"Is that really worth it?" Council Member Bruce Southworth asked, as the real-estate rate came up for a vote. Southworth, who took office in January, cited the slow economy and its effect on jobs. He was the only member to vote against the rate.

Council Member Sharon Turner and Mayor Tom Bozarth said the council usually takes the compensating rate, "to keep our revenues kind of steady," as the mayor put it. Turner said the rate makes up for depreciation of property. Later, they said failure to adopt the rate permanently sacrifices revenue that is available to the city from sticking with the compensating rate.

(The council can set whatever tax rates it wants, but if it wants to increase revenue more than the roughly calculated compensating rate it must hold a public hearing. If it wants a rate that would increase revenue more than 4 percent, citizens can petition for a ballot referendum on the rate.)

Council Member Grayson Vandegrift said he had thought about skipping the compensating increase for this year, but "this one doesn't particularly bother me, it's such a minor increase."

But when the council came to the personal-property rate, Vandegrift voted against it. He said he understands why the city's accountant recommends the compensating rate, to take whatever rate is easily available, but "I just disagree with that philosophy."

Council Member Sara Hicks said the total revenue increase could be used to support civic activities sponsored by Midway College, which sought support at the meeting for its Artists and Lecture Series. Council Member Dan Roller said he would prefer that the council support the city's regular expenses and use windfalls like last year's $2,500 donation from the Iron Horse Marathon to make donations.

Earlier, the council agreed to continue its $1,000 annual support of the Artists and Lecture Series, indicating to college spokeswoman Ellen Gregory that it might increase its support if the college assembled next year's lineup and asked for support while the council is making its next budget.

"I'm very excited" about the 2013-14 schedule," Hicks said. "This is a really valuable service the college offers Midway . . . for the citizens of the town to have access to cultural events."

Gregory said a few parts of the schedule are still being finalized. Among those firmly scheduled are a Constitution Day observance with Deputy Chief Justice Mary Noble, Sep-t. 17 at 7 p.m.; Dr. Clifford Kuhn, The Laugh Doctor, Oct. 17 at 5 p.m.; a Mary Todd Lincoln chautauqua on a date to be determined in March; and Kentucky Poet Laureate Frank X. Walker April 1 at 7 p.m.

Among other business, the council accepted a $29,000 bid from Renner & Sons of Lexington to place a cut stone facing and cap on the reconstructed wall on Gratz Street. Bozarth said the other bid, from Bobby Cameron of Mount Vernon, was $32,000. Here's a current photo of the project:

No comments: