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City council agrees on budget plan

May 17, 2006|by ANDREW SCHOTZ

HAGERSTOWN

Hagerstown's 2006-07 budget was approved in concept Tuesday and includes 12 new fire and police department positions and the first phase of a salary-increase plan for city employees.

It increases spending by about 24 percent from this year, yet carries no increase in the property tax rate - although taxes would go up because of rising assessments.

The Hagerstown City Council unanimously approved a first reading of the $134.4 million spending plan Tuesday that would leave the tax rate as it is. The council is scheduled to formally adopt the budget and the tax rate May 23.

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Also Tuesday, officials said city residents should expect to see electricity rates go up about 42 percent and water and sewer rates go up 3.5 percent.

The tax bill on a house assessed at $100,000 would rise about $80 if the assessment goes up the maximum 10 percent next year, Finance Director Alfred Martin said.

The city's property tax rate is 79.8 cents per $100 of assessed value.

The proposed budget that City Administrator Bruce Zimmerman released six weeks ago called for no tax-rate increase, but did not include the new police and fire employees or the wage-increase plan.

Under Zimmerman's proposal, the city would have had to raise its tax rate to fund those additional elements.

But, in the ensuing weeks, the council made cuts that allowed it to fund both the new employees and the first phase of the wage increase without affecting the tax rate.

Still, for a handful of city residents who spoke at public hearing Tuesday, the effort was not enough.

"I don't make a lot of money. I don't get increases," Jane Barlup of Carroll Heights Boulevard said.

June Myers of Calvert Terrace said she and her husband, like many longtime residents, are struggling to keep up with the higher costs of living.

"You all seem to be in our pockets all the time," she said.

If taxes go up, Karolyn Martin, who owns property on East Washington Street, said she'll have to raise rates at her daycare business.

"Consider the rippling effect," she urged the city council.

Councilman Kristin B. Aleshire said the council still needs to decide how to apply a $600,000 surplus in this year's budget to next year.

The council has created a "structural deficit" for future budgets that has not been addressed, he said.

Councilwoman Kelly S. Cromer said she would have liked to have funded many other requests, but it would have meant raising the tax rate.

If it weren't for the additional 10 fire department and two police department employees in the proposed 2006-07 budget, the city council could have lowered the tax rate, Councilman Lewis C. Metzner said. But, the new positions were essential, he said.

The proposed budget funds the first year of a wage increase recommended by Springsted Inc., a consulting firm.

Fully funding the recommendation is expected to cost the city about $5 million over three years.

City employees have proposed cutting health insurance benefits as a tradeoff.

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