For the first time in four years, Gainesville officials are considering raising taxes.
An initial proposal for next year’s budget includes a 2.5 percent tax increase for city residents.
The proposed increase — an added 0.26 mills to the city tax rate — will help the city close a $1.3 million gap between revenues and expenses for the upcoming fiscal year, which begins July 1, city officials said Monday.
For the owner of a $100,000 home, it will mean paying another $26 in city property taxes.
City Manager Kip Padgett said the tax increase mostly will pay the salaries and benefits of new firefighters the city hired late last year.
But it will also help the city recoup revenues lost when business across Gainesville closed. As those businesses shuttered and cut down on inventory in what has been dubbed the Great Recession, the city lost a chunk of its revenue from personal property taxes, Administrative Services Director Melody Marlowe said.
“We have to make that revenue up right off the bat,” Marlowe said.
City Council members knew last year that the city would have to eventually shoulder the financial burden of the new firefighters.
The council decided to hire the 18 firefighters in September, voting 4-1 to accept a $1.92 million grant from the Federal Emergency Management Agency.
“Well, we said we’d accept the grant, didn’t we?” Councilwoman Myrtle Figueras asked.
The grant paid for the hiring and the training of the firefighters, allowing the fire department to shore up understaffed engine companies across the city and bring the department up from an average of three firefighters per truck to the national standard of four per truck.
The grant requires the city to gradually take on the full costs of the new firefighters’ salaries and benefits over a five-year span.
It also requires the city fire department to maintain specified staffing levels, meaning the department would have to end employee furloughs by July 1.
Since November, all city employees have been required to take one day off without pay each month.
So far, city officials say they plan to end furloughs citywide by July. However, city employees will have to wait at least another year before they can expect any raises, Padgett said Monday.
In September, Councilman George Wangemann voted against accepting the FEMA grant, saying it would eventually lead to a tax increase for city property owners.
Under the tax increase city officials discussed Monday, the city’s portion of tax bills would rise to 2.92 mills from 2.66 mills.
“We’re going to see the impact ... but at least we were able to get that initial funding for our community,” Figueras said.
If the city school board keeps its millage rate the same this year, the overall millage rate for city properties would rise to 10.63 mills from 10.37 mills.
And if the City Council stands by the proposal when it approves next year’s budget, the tax increase will be the first in four years for the city government.
In 2006, the City Council approved a tax increase to pay off debts incurred from the construction of the Frances Meadows Aquatic and Community Center and the downtown parking deck.
Prior to that increase, the council raised the millage rate in 2002 to pay for 28 new public safety positions, Marlowe said. Of those positions added, 10 were in the police department, 17 were in the fire department and one was for a code enforcement officer, Marlowe said.