None of the four council members offered a motion to approve the property tax hike, which would have also served as approval of the city’s proposed budget of $2,110,161.
The council tabled the budget — to the applause of about 70 people at meeting.
The indecision came after 90 minutes of public comments that brought many questions. None of the concerned speakers supported the possible tax increase.
City officials have now scheduled a budget work session for Monday, Sept. 17, at 4 p.m. The budget years begins Oct. 1.
The proposed property tax increase is designed to replace an administration fee that is being discontinued at the end of this year. The fee is a $6.50 monthly administration charge was paid by everyone with a water meter.
The city initially planned to raise the property tax (millage) rate by 3.655 mills, from 9.035 mills to 12.69 mills.
The city then proposed a smaller tax rate hike of 1.91 mills, from 9,035 mills to 10.945 mills. The reduction would mean, for example, that on house with a market value of $100,000, the property tax levied by the city would be $437 instead of $507.
In order to go to the lower tax rate, the city made two key changes in the proposed budget: it reduced library funding by $12,000 to $54,205; also, it will dip into the city’s reserve funds for $105,980 to balance the projected budget.
Property owners speak out
The first Rossville resident to speak out at the Sept. 10 meeting was Travis Poole, a financial planner from Chattanooga who had a copy of the proposed budget.
He spoke for more than 30 minutes, calling into question projections for revenue and expenditures in the budget, which has been balanced with reserve funds since 2006, according to mayor Teddy Harris.
Some of the answers caused Poole to question passing a budget with such uncertainties.
Harris dismissed his calculations: “I think you are way off.”
The city reserve fund could be drained in three to four years if the annual budget continues to encounter revenue shortfalls, council member Cindy Bradshaw.
“Let’s say the account goes to zero. Where do we go to get funds if we have no money?” Poole asked.
“You tell me,” Harris said. “This is why we can’t continue to go on this path.”
Poole suggested increasing the $500 deductible for employee health coverage, which is now paid by the city. He suggested increasing the deductible to $1,000, with the employee paying the first $500 and the city paying the second $500. That change would save the city overall, according to Poole.
He also suggested that city officials modify the employee retirement fund, which will increase from 8.38 percent to 9.75 percent under the proposed budget. The percentage is mandated by the Georgia Municipal Association. Council member Joyce Wall defended the pension plan, saying that it is 88 percent fully funded currently.
Poole suggested lowering it to a 6 percent contribution base, in which the employee would have to match a 3.75 percent portion to continue receiving the full benefit.
Several residents who live on South Mission Ridge Road spoke in opposition, with Skip Williams suggesting that mayor Harris resign if he could not balance the budget without raising taxes.
“People where I live are very very irritated,” said another Mission Ridge resident, William Woods, to loud applause and cheers. “There is a groundswell right now for governmental responsibility and de-annexing the whole Ridge.”
Woods speculated that loosing the 80 homes on Mission Ridge Road would ultimately lead to the ending of the city’s charter, similar to Lithia Springs in 2001.
“My husband has operated a law office in Rossville for thirty years,” Ridge resident Kathy Willard said, “and if we didn’t balance our budget every year and know to the penny where our finances were going, Joe and I would have filed our own bankruptcy and been out of business.”
Council member Wall challenged the criticism by encouraging the speakers to qualify for her seat. She is not seeking re-election next year.
“Anyone out here can qualify to run, be elected in November (2013), and all the problems ought to be solved by December,” Wall said.
She said she would have seconded the proposed budget, despite not voting to put the budget motion forward. She didn’t believe it would pass and had lost previous support from council member Hal Gray, she said.
Gray had suggested tabling the proposed budget after nearly 20 seconds of silence following mayor Harris’ reading of the ordinance.
Bradshaw is seeking the elimination of a $5,000 line-item for annual municipal seminars for council members. She was the only council member who wanted to wait on the ordinance, which was revealed by an audience question prior to the vote.
Council member Rick Buff opposed the tax increase from the start, but favored utilizing reserve funds, which could have drained the city coffers quicker than the current projection. He was upset by the suggestion of dissolving the city charter.
“The only way to do away with that administrative fee was to raise property taxes,” Buff said. “Let’s do what we have to get through this year.”