But if the changes agreed to Tuesday are implemented and used to offset the tax increases, the tax rates would instead increase by about 4.9 percent.
To homeowners whose properties are assessed at $100,000, the 7.2 percent tax increase would add $53 to their annual tax bills. A 4.9 percent increase would add $36 to their annual tax bills.
The proposed tax increases would help balance the proposed $25.7 million city general fund, which calls for increased spending including about $1.2 million to cover the additional cost of employee wages and benefits, and about $500,000 in increased spending on vehicles and construction projects.
The general fund is the only city fund that receives money from city taxes. Other funds, such as water and sewer, receive money from user rates and fees.
Tuesday's council meeting was the first time the council agreed to any major changes to next year's budget.
All of the proposed changes agreed to Tuesday were suggested by Councilman Kristin B. Aleshire.
Raising the trash fee, which is now $86 a year, by $2 annually, would bring in an additional $27,000, city Finance Director Al Martin said.
Reducing the amount budgeted for stadium improvements by $10,000 would still leave $20,000 in the budget for stadium work.
Repaving and other improvements to the parking lot at Pangborn Park was budgeted at $80,000, and was to be paid for with money from the city's Community Betterment fund, which is money that comes from the Light Fund. Eliminating that project frees up that money to be used on improvements to Fairgrounds Park, which would have been paid for with General Fund money.
Some of the other changes included reducing by $25,000 the contingency fund, which is a reserve for emergencies, and increasing the payments from the city's light, water and sewer departments to the general fund by a total of $50,000. This payment, called a payment in lieu of taxes, is intended to represent the amount those departments would pay to the city if they were private companies, Martin said.
The council is scheduled to continue discussing potential changes to the budget next Tuesday, and May 21. A final council vote on the budget and tax rates is scheduled for May 28.