Council splits on tax increase
SNOHOMISH — The City Council made a surprising decision last week to vote down the proposed 1 percent property tax increase that was put forth by City Manager Larry Bauman and supported by Mayor Karen Guzak.
After a lengthy discussion among council members and a public hearing at the Nov. 20 council meeting, the council voted 4-3 to not take the 1 percent increase.
Council members Lynn Schilaty, Greg Guedel, Derrick Burke and Dean Randall voted against the increase, while council members Paul Kaftanski, Tom Hamilton and Guzak voted in favor of it.
“I think it’s the right thing to do,” Kaftanski said at the meeting. “I don’t think it’s too much to ask people to pay a few more dollars a year.”
Burke expressed concern regarding the “palatability” of telling taxpayers to pay a little more.
“It seems odd to have this come to us year after year with no reason attached,” Burke said.
State law allows cities to impose a 1 percent property tax increase each year. The property tax is a major revenue source for local government and before Initiative 747 limited the growth rate to 1 percent, cities could raise the tax rate up to 6 percent each year.
In part because of the recession, the city for the past three years decided to forgo taking a 1 percent increase.
This year, Bauman’s proposed 2013 budget included a 1 percent increase.
The cost to the average homeowner would have been less than $3 per year, though the cumulative effect on the budget is substantial, Bauman said. By adopting a 0 percent increase again for 2013, the cumulative impact for the years 2010-2017 will be a revenue loss of $274,250, Bauman said.
Discussions earlier this month with staff suggested the property tax increase was expected to pass. Guzak had said she felt good about the proposed 2013 budget and was inclined to take the increase.
“It’s clear that the last three years we didn’t take that 1 percent helped us get in the hole a bit,” Guzak said earlier this month, adding that taking the increase would be “the most responsible thing to do.”
The current city property tax rate of $1.13 per $1,000 assessed home value is the lowest of all cities in Snohomish County.
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