Council OKs cut in tax rate

$68.6 million budget in Annapolis gives raises to workers

May 24, 2006|By NIA-MALIKA HENDERSON | NIA-MALIKA HENDERSON,SUN REPORTER

Annapolis residents will see a lower property tax rate, more police officers and firefighters, and pay raises for employees, according to the $68.6 million budget the city council unanimously approved Monday night.

New capital projects funded in the budget that takes effect July 1 include repairs to the bulkheads at City Dock, an expanded recreation center at Truxtun Park, upgrades at the Eastport Fire Station, burying of utility lines near the State House and other road projects.

Council members called the 3-cent property tax rate reduction - to 53 cents per $100 of assessed value - "modest relief" for homeowners faced with rising assessments and gas and electric costs.

Those rising assessments - up an average 27 percent last year in the city - will mean that homeowners can still expect to see higher tax bills.

Assessment increases for tax purposes are capped in the city at 10 percent a year, the state maximum, so the owner of a home previously valued at $300,000 will pay taxes on a newly assessed value of $330,000. That translates into a city tax bill increase from $1,680 this year to $1,749 next year. That amount doesn't include thousands of dollars in county and state property taxes.

Mayor Ellen O. Moyer had proposed leaving the property tax rate unchanged, noting the increased cost of running the city because of a 30 percent rise in fuel costs and electric rates.

But the council approved a recommendation by the three-member finance committee that largely funded the tax reductions by using $800,000 in boat show revenue.

"The budget was a challenge because we needed to maintain the existing level of service but provide some tax reduction," said Alderman Josh Cohen, a Ward 8 Democrat. "I'm pleased that with a lot of participation from members we were able to do both."

Alderwoman Julie M. Stankivic, an independent who represents Ward 6, said that the council did not go far enough in looking for budget cuts.

"I think the taxpayers deserve the tax break, but I just wish it could have been more," Stankivic said. "It could have been more if we'd looked more closely at the budget."

Cohen countered that given the $2.6 million rise in the budget - an 8 percent increase from this year - additional cuts were not possible.

"We looked at the budget page by page and line by line," he said. "We couldn't have cut the budget more without cutting the existing level of services."

Moyer said that "two quarters and three pennies" was not a lot to pay for the level of service the city provides and that salary increases for city workers were overdue. The 3 percent cost-of-living increase will cost the city about $1 million.

Moyer added that increasing the city's debt service to reduce the property tax rate should not be a long-term plan.

"I am concerned that that we're funding the tax rate by borrowing money. It's not a good idea," she said. "But I'm glad that the capital projects weren't hurt."

The city's capital improvement plan includes $1.6 million for repairs to bulkheads at City Dock, $500,000 for vehicle improvements and $600,000 for water and sewer repairs. Moyer said the bidding process on capital projects will begin in July or August.

Five more police officers will increase the number of foot patrols across the city and the addition of up to 12 firefighters will ensure that units can cover vacation and other absences adequately, the mayor said.

nia.henderson@baltsun.com

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