Real estate tax hike possible

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The Alexandria City Council voted to publish a maximum real estate tax rate of 83.5 cents per $100 of assessed value, two cents more than the rate now in effect.

When we finally adopt the FY 2008 budget, I hope that the actual tax rate will be much closer to the current rate than the maximum rate we are publishing but that maximum rate gives us some options for considering a COLA for city and school employees, adding money to subsidize childcare and narrowing the gap between the School Boards requested budget and the one proposed by the city manager, said Mayor Bill Euille.

The two additional cents would produce $6.8 million in additional revenue. Each percent of COLA for school and city employees costs $3.1 million. Most members of Council are proposing adding a COLA of 1.5 percent, which would cost $4.65 million. If Council wishes to pay for childcare subsidies for the nearly 300 children who are on the waiting list because of changes in federal eligibility guidelines, that will cost $1.1 million. Without adding funds for the public school system, those additions will cost $5.75 million.

New revenue projections for FY 2008 show an increase of $3.5 million over previous estimates. The largest two changes for FY 2008 are a $1.1 million increase in federal government prisoner per diem payment revenues and a $1.9 million increase in real estate revenues from changing the prior estimate of a 0 percent increase in the calendar year 2008 real estate tax assessments to a 1.4 percent increase.

I support publishing this maximum rate but hope that we can stay closer to the current rate, just as the mayor said, said Councilman Tim Lovain. Establishing a budget target is a very serious process and I hope that we can come very close to meeting that target as the city manager did in his proposed budget. I do believe that we should give our employees a COLA and there are some other additions that we may want to consider. This, along with potential sources of additional revenue gives us those options.

Council members were required to submit any budget additions over $50,000 that they are considering. Everyone wishes to add a COLA and all of them are proposing an additional $2 to $2.8 million for the school system. Everyone also plans to add funds for additional childcare subsidies of between $750,000 and $1 million. Discussions on the budget will continue until May 7, when Council will vote.

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