When City Manager Jim Hartmann advised the city council not to raise real estate taxes earlier this year, it was just budget guidance, not a guarantee.
Subsequently, Council members decided Saturday they want the flexibility of raising the base real estate tax rate to as much as $1, a hike of 2.2 cents if passed.
The council is required to advertise a maximum tax rate in advance of passing the budget in May, in case it deems the extra revenue necessary. Some members indicated it very well could be.
Historically weve always accorded ourselves some flexibility to advertise a rate slightly higher just to give us some wiggle room, said Mayor Bill Euille.
Three big-ticket items made council members rethink their original stance as they wade through the budget process: pricey improvements for public school infrastructure, uproar over a net loss in pay for many public employees and anger from the business community over a possible commercial add-on tax.
The $1 [tax rate] does not give us flexibility to do all of that, but it does give us flexibility to have a dialogue with the business community and the citizens as a whole around whats the best way to have the discussion, said Councilman Rob Krupicka.
The new tax ceiling would add $7.2 million to the general fund, offsetting some of these costs, but charge property owners $1 for every $100 of their parcels value.
Council members said they would shoot for the current tax rate of 97.8 cents, but the act of raising the ceiling is a signal to taxpayers, said Councilman Paul Smedberg.
I understand what people are saying here, that the ultimate goals is to maintain that rate, however when you look at the challenges before us we are already saying to the community that we are going to raise the rate, Smedberg said.
If a higher tax rate is passed, it would be the fifth consecutive year.
Council will hold a public hearing April 16 and adopt the final tax rate May 2, during the final budget adoption.