Posted on 04/17/2003 6:16:26 AM PDT by GailA
Wharton's budget could hike property tax rate by 35 cents By Michael Erskine erskine@gomemphis.com April 17, 2003
Shelby County Mayor A C Wharton on Wednesday outlined the basic details of his first budget proposal to the County Commission, a no-frills plan that could require a 35-cent hike in the property tax rate.
The preliminary $347 million budget for the fiscal year that starts July 1 - which doesn't take into account possible added costs for schools - includes no pay increase for the county's 7,000 employees and freezes hiring and nonessential spending.
The budget plan also would cut more than $2 million in funding for Memphis and Shelby County public libraries and more than 40 community agencies and nonprofits.
A tax increase appears a certainty amid rising costs for mandatory spending like health benefits and payments on the county's $1.5 billion debt, as well as shortfalls in state and local revenue.
The potential 35-cent increase would cover a $41.7 million gap (29 cents) in the general fund and $8.6 million (6 cents) in new debt service requirements.
"We can't cut our way out of a $41 million problem," said James Huntzicker, the county's director of administration and finance.
A further strain could come in the form of additional funding requested by the Shelby County school system, which has yet to submit a budget proposal.
Several commissioners said they were irritated the school system had not submitted its proposal. They accused the school board of waiting to see how the controversial Arlington high school proposal would fare at Monday's commission meeting.
"I think that's unacceptable," said Commissioner Deidre Malone.
School board chairman David Pickler said it was a misunderstanding.
He said his system just re-ceived its funding commit-ment from the state Tues-day - which accounts for 49 percent of the budget - and that the Arlington debate also had delayed budget planning.
Pickler said a "rough-sketch estimate" would be given to the commission today, saying finance officials have estimated a $29 million shortfall. But he said the school board had not yet had time to start making cuts, which will be significant.
A 35-cent property tax in-crease, which would raise the county tax rate from $3.79 to $4.14 per $100 of assessed value, would cost the owner of a $150,000 home about an extra $130 a year.
Wharton stressed that his proposal was just a recom-mendation and that he hopes to continue to trim costs in the coming weeks.
Cleo Kirk, the commission's budget chairman, said he thinks the commission will be able to trim the proposed 35 cents by about 15 to 20 cents.
"We may just have to ask everybody to reduce their budgets by 5 percent, 10 percent," Kirk said.
Wharton said his ultimate goal with his budget plan is to reverse a steady increase in the county's debt, which is still growing largely due to school construction.
He said he hopes the county can begin to reduce the debt in 2009.
The mayor did not propose any layoffs but said he hopes to reduce the county workforce by 5 percent a year through attrition, saving $5 million annually.
Wharton also announced Wednesday that he will seek permission from the commission to get state approval for an adequate facilities tax.
Such a fee, which would be levied on new construction, could generate an estimated $4 million to $7 million a year, he said.
"Property taxes you pay forever. Development fees you pay once," he said.
- Michael Erskine: 529-5857
The feed back thing doesn't work. BUT the phone numbers for them are listed with their bios. Shelby Co gov't
County Commissioners main switch board 901-545-4301
The new Grizzlies arena adds to the debt load.
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