Carson City staff will recommend an 11.7 cent increase in the city's property tax rate to city supervisors today as part of a package to make up for an expected $2.2 million budget shortfall next year.
The proposed increase is the largest in several years, officials said, but would still leave property owners paying less than their counterparts in any other surrounding Northern Nevada county.
The meeting is the first of four special meetings scheduled for the next week. Supervisors plan to meet with each city department to discuss budget cuts, look at next year's expected revenues, and figure out how to pay for public services.
The budget proposal calls for the increase in property taxes and avoids cuts to services, like closing the library on Saturdays and the public pool on Sundays, said Finance Director David Heath.
Mayor Ray Masayko said he has heard from the Carson Area Chamber of Commerce, whose members are concerned about the proposed hike in property taxes.
The increase would equate to a $60-per-year increase for a house valued at $150,000. Currently, the tax rate for the average property is $2.58 per $1,000 of assessed valuation.
"I'm concerned about that, and so are they," Masayko said.
The property tax increase would be made up of two components. The city proposes to activate a 3.7-cent increase to meet its obligation to the Silver Springs Regional Juvenile Center, which is normally paid for out of the general fund. The additional 8-cent increase would generate $850,000 to pay for maintaining public safety equipment and other capital spending.
Staff's recommendations to make up for the $2.2 million budget deficit include:
-- Departmental cuts of $500,000
-- Salary savings by delaying the filling of positions, $500,000
-- Reassigning costs, like engineering, out of the general fund, saving $200,000
-- Refinancing bonds for the construction of the Public Safety Complex, saving $500,000
-- Payoff City Hall construction loan, saving $170,000
-- Activating the 3.7-cent property tax increase for the Silver Springs Regional Juvenile Center obligation, earning the city $400,000 a year
Supervisors will consider staff recommendations and consider whether to raise property taxes or use reserve funding to make up the difference, Masayko said.
"We think we have a fair proposal to balance the budget," said interim City Manager Andy Burnham. "We have a whole host of alternatives to look at."
Other options include increasing park and recreation fees by 10 percent, a 3 percent increase in business license fees, increases in franchise fees for gas and electric operations, and raising water and sewer fees.
The city has $6 million in reserves, Heath said. The board is holding $4 million of that as part of a financial stabilization policy. The other $2 million can be used to help mitigate the situation, he said.
"I prefer they sit on (the $2 million) for another year," Heath said.
The city is projecting a $1.5 million decrease in sales tax revenue and an increase of $2.1 million in salaries, wages and benefits.
Staff had projected a base budget of $18.3 million, but adjusted it to $17.4 million after considering a $335,000 revenue loss with the closure of Super Kmart this year and another $500,000 loss after Wal-Mart moved to Douglas County.
Nevada Department of Taxation forecasts a sales tax revenue disbursement of $17.3 million -- more than $450,000 less than what Carson expects to receive.
Carson received $19.5 million last year in sales tax revenue.
The city's proposed General Fund budget for fiscal year 2003-2004 is $45.5 million. The current year's budget is $44.8 million.
IF YOU GO
What: Carson City budget meetings
When: 6 p.m. today, 6 p.m. Monday, 6 p.m. Tuesday, 1 p.m. April 10
Where: Sierra Room, Carson City Community Center, 851 E. William St.