The city basically has two options to make up the loss, city manager John Culpepper told the council during its regular monthly meeting Monday, March 4.
One option, he said, is to re-implement a millage (property) tax. The city has not levied a property tax for more than a decade. “I think the last thing city council wants to do is bring back (property) taxes,” Culpepper said.
The other option, he said, is to hike service rates.
The council elected to raise rates on garbage and trash pickup, which would ease budget woes with the least strain on citizens, council members said.
The city will not change its twice-weekly pickup schedule or increase fees for additional garbage cans.
Rates will increase to $15 from $10 per month for residential customers, to $20 from $10 per month for commercial customers, and to $400 from $200 per month for Crystal Springs Print Works.
“Over a twelve-month cycle, that’ll generate approximately $75,000 in revenue,” Culpepper said.
The hikes will go into effect April 1. All bills mailed out on or after that date will reflect the increases.
Reason for shortfall
For the first time since Synthetic Industries was annexed into Chickamauga, the city received a Georgia Power franchise fee on the industry’s electricity usage of less than $300,000, Culpepper said.
As this particular money stream is “the largest revenue producer for the general fund,” he said, the city finds itself unable to meet its expected expenditures for the coming year, having budgeted based on the usual averaged amount received from the franchise fee.
“For three years prior to 2008, when (the nation’s economy) went south,” Culpepper said, “the Georgia Power franchise fee averaged $425,744 per year. In 2008, that dropped to $325,000 — a $100,000 decrease. Well, that was the result of the housing market going south and the economy going south. But it has bounced back over the last two years, with $357,216 and $359,790.”
For the past three years, the city was able to float the difference between the $325,000 to $360,000 and the expected $425,000 thanks to reserves. This year, however, is a different story.
“We were able to handle the $325,000,” Culpepper said, “but now it’s put us into a situation where we can’t meet this year’s budget.
“We always get the check in February based on the power sales (of the previous year),” Culpepper said. “That came back a week ago and we were down to $279,000 — the worst check we’ve ever got. So basically we’re going from an average of $425,000 down to $279,000 — that’s $140,000 in lost revenue.”
The increase in garbage pickup fees will bring the city back to approximately the same amount it has received in Georgia Power franchise fees for the past two years.