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City officials back away from steep tax increase

March 16, 2011|By MATTHEW UMSTEAD | matthewu@herald-mail.com

MARTINSBURG, W.Va. — Members of Martinsburg City Council's budget and finance committee on Wednesday recommended a minimal levy rate adjustment that will generate 3 percent more in tax revenue.

The committee initially considered adjusting the rates to generate 12 percent more in property tax revenue to balance the 2011-12 budget, a proposal that triggered the scheduling of a public hearing, which still will be held on Monday.

With the lower adjustment in the levy rate, a resident with a property worth $200,000 would pay an additional $6.96 per year, according to figures compiled by City Finance Director Mark B. Spickler.

Business property owners using the same property and assessed values would pay an additional $13.92 per year.

Although the decline in business and occupation tax revenue appears to be leveling off, Spickler has said that he anticipates increased financial allocations for health insurance, the public employees retirement system, matching grant obligations for additional firefighters and other costs.

To close the gap last year, the city adopted a rate adjustment to generate 12 percent more revenue, which is the maximum allowed under state law. Positions in city government were left vacant, and employees did not get raises for a second consecutive year, Spickler has told the committee.

Councilman Roger Lewis, who has been the leading opponent against back-to-back increases, suggested the city consider taking money from parking revenues to plug the revenue hole, among other options.

City Manager Mark Baldwin said Wednesday the city would be able to balance the budget using money not spent from the current fiscal year, which ends June 30.

Spickler and Baldwin both cautioned city leaders that they could face an even larger revenue gap to fill next year if business and occupation tax collections do not improve.

Spickler also noted that city residents are likely to see an increase in their sewer bills due to the Chesapeake Bay regulations being enforced by the federal government.

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