City Council: No Real Estate Tax Increase

City Council decided Tuesday to keep the real estate tax rate at its FY2013 level of .74 cents per $100 of assessed value and make about $1 million in line item cuts to the city manger's FY2014 recommendations in order to balance the budget. 

The vote was 5 - 2 to approve the $187,887,023 budget on its first read.  "That is the total for all funds, including the general fund, schools, all fiscal agencies, enterprise and capital funds," said City Manager Bev Cameron.  The total budget for the General Fund is $81,411,580.

Councilmembers Kerry Devine and George Solley voted against the budget, saying it was not in the best interest of the city. 

"I believe we are overlooking things we will have to address again next year, and it will be a year down the road," Solley said. "We're violating our own expression of what the city needs to move forward.  We did a $90,000 organizational study, and we are not taking that study's advice," he said.

“We’re barely maintaining the status quo, we're getting zero improvement,” Devine said.  "In hard times I get that it's hard to ask people to pay more, but I also think you need to invest in your city, invest in your economic development, invest in your quality of life," she said.

The cuts include a reduction of $123,000 from what Fredericksburg City Public Schools had requested from the city.  The council voted unanimously to transfer just over $26 million toward the school's total operating budget of $37,381,901 million. The transfer from the city to the schools is $1 million more than last year. "The total schools budget has increased $1,624,999 from FY 2013," Cameron said.

Other expenditure cuts made to balance the budget include (savings in parenthesis):

• Eliminate a proposed city purchasing agent position ($90,825)
• Reduce tourism marketing ($20,000)
• Franchise solid waste collection for the city ($141,500)
• Eliminate two proposed Advanced Life Support (ALS) medic positions ($135,155)
• Holding open three full time positions in city services ($180,000)
• Phase-in cost of living adjustment (COLA) raises for city employees, with one percent paid in July 2013 and one percent paid in Jan. 2014 ($90,000)

City and schools staff will receive a 3 percent pay raise. One percent covers the required employees’ contribution to the Virginia Retirement System.

Council supported a reduction in the Business and Professional Occupancy License (BPOL) tax to provide tax relief for small business.  The ordinance change will be handled at a future council meeting, Cameron said.

"I am disappointed this budget does not follow through on many of Council's goals and initiatives," said Mayor Mary Katherine Greenlaw.  "It sets up a more difficult budget for next year," she said.

The final vote on the FY2014 budget is scheduled for the May 28 City Council meeting. 

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