City property owners will see a tax increase next year of less than 1 percent if the proposed $37.1 million 2012 comprehensive city budget is adopted in November.
City Finance Commissioner Kenneth Ivins unveiled a proposed 2012 budget on Tuesday that spends $800,000 less than this year’s budget.
“Last year was the toughest budget I ever put together, and this year was one of the easiest,” Ivins said.
Ivins said his goal during the budget process is to reduce the 0.54 percent tax rate increase to a slight tax rate decrease in 2012.
When the City Council started working on the 2011 city budget last fall, the tax rate increase was projected at more than 8 percent. The 2011 tax rate increase was reduced to 4.45 percent after the city received more sales tax revenue than expected and made other budget reductions.
This year the city received an unexpected $1.49 million in video lottery terminal revenue from the state for hosting the Saratoga Casino and Raceway. Most of this money was placed in a tax stabilization fund, but no money from this fund is being used in the proposed 2012 budget at this time, Ivins said.
Ivins is not proposing any staffing cuts. However, a new position of reservations coordinator for the Canfield Casino in Congress Park is not included in the proposed budget.
The City Council had approved the new position, but Ivins said he can’t support it at this time.
The proposed city budget tax increase of 0.54 percent will mean the owner of a home valued at $200,000 would see a $8.61 increase from $1,212.80 to $1,221.41.
The City Council will hold several budget workshops over the next month. The council will also hold public hearings on the budget on Oct. 8 and Nov. 15. The council must approve a 2012 budget by Nov. 30 or the comprehensive budget as released by Ivins on Tuesday will become the final 2012 budget.
Ivins said he is only projecting that sales tax revenue — one of the major sources of the city’s revenues — will increase by $250,000, from this year’s projected $9.25 million to $9.5 million.
The city received just more than $9 million in sales tax revenue in 2010, but it was considerably more than city officials expected. Ivins said he only projected a 2 percent increase in sales tax revenue this year from 2010.
The city won’t know its August sales tax revenue numbers until late October or November, he said.
Michele Madigan, the Democratic candidate for city finance commissioner, attended Ivins’ news conference on the new budget.
She said she is concerned about the “current commissioner’s consistent inability to project the balance of the current year’s revenues and expenses when building next year’s budget.”
Madigan said in a prepared statement that “Mr. Ivins has been unable to produce a realistic budget during his entire tenure and many of his budgeting decisions appear to be driven by politics.”
Madigan said she would like to see the 2012 budget not include a property tax increase.
Ivins said the city’s unappropriated fund balance at the end of 2010 was $4.2 million.
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