Council to vote on property tax increase next month
SNOHOMISH - Next month the city will decide whether to authorize a 1 percent property tax increase.
Each year, the city has the option to increase the property tax by 1 percent without a public vote. The last time the city took the increase was in 2009.
As in years 2010-2013, city staff is recommending the City Council take the increase. The increase would be implemented within the 2014 budget.
The 1 percent increase would generate about $10,000 for the city, a small amount in terms of the overall general fund, but the city argues the cumulative amount of revenue loss each year the tax increase isn’t authorized is significant.
A staff report for the Oct. 15 council meeting emphasizes the cumulative loss of revenue that increases each year the increase isn’t taken: “This amount grows each year as an ongoing amount of annual lost revenue. As the council approved a 0 percent increase for the 2010, 2011, 2012, and 2013 property tax levies, the cumulative annual revenue loss from not accepting the 1 percent increase is now $42,272 and would grow to $52,967 if a 0 percent increase is also approved for 2014. The running total of revenue loss (adding each new budget year’s loss to the totals of previous years) since the 2010 budget is $104,283 for 2013 and would increase to $115,401 in 2014 if a 0 percent levy is adopted.”
Mayor Karen Guzak continues to support the increase, but has yet to be met with like-minded council members to approve it.
“I think it’s clear I’m a supporter of this,” Guzak said. “It amounts to just a couple more dollars per person per year, less than the price of a latte.”
The proposed 1 percent increase for 2014 would cost the average homeowner about $2.42 more per year.
Councilman Tom Hamilton said it is important for the city to authorize the increase.
“This type of tax is a steady source of income, unlike sales tax which can vary greatly depending on many economic factors,” Hamilton wrote in an e-mail.
Sales tax revenue is the city’s largest revenue source followed by property tax revenue.
The first public hearing on the tax increase was held at the Oct. 15 council meeting. Councilman Paul Kaftanski said he has to decide how he will vote. He voted last year for a tax increase.
“The council decided to add an additional seasonal position (in 2013) that cost approximately what the 1 percent would have generated,” he wrote in an e-mail.
Councilman Dean Randall said he would vote against an increase.
The second public hearing is scheduled for Tuesday, Nov. 5. At that time, the council will vote on an ordinance that will include adopting either a 1 percent or a 0 percent property tax increase.
“We could have had a little more money, for example, to help the senior center, or to work on park benches,” Guzak said. “That’s money that goes into the general fund, which supports the quality of life in this city.”
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