Oakwood City Council voted Monday night to OK a budget that keeps the city solvent but is supported by a tax rate increase of about 50 percent.
The total budget for fiscal 2015 is $6.6 million, with a $3.7 million general fund making up most of that.
The general fund consists mainly of operating and capital improvement expenses, as well as debt obligations totaling $683,000.
The city’s debts particularly are hamstringing its finances, resulting in the council’s vote earlier this month to increase the tax rate to 4 mills from 2.658.
Translated, 1 mill equals $1 for each $1,000 in assessed property value, with property assessed at 40 percent. So, taxes on property with a $100,000 value would increase by $53.68.
The South Hall city has mailed tax bills to residents, with taxes due Jan. 1, or the beginning of the fiscal year.
Oakwood has nearly a $992,000 difference between operating expenses and its revenues, but that amount is being used to pay for debts, some vehicle replacement and to help build reserves.
“If we have anything left over, that would go toward reserves for the next year,” City Manager Stan Brown has said, adding the goal is a three-month reserve.
To help make ends meet, the city is going without filling six positions, including assistant city manager, planning director and police clerk.
The tax increase was opposed by several residential and business property owners, with some speaking out at public hearings.
Some said they believed the higher rate should be rolled out over a period of years. Others complained the rate was just too high and that people are still suffering from the economic downturn.
Brown has said much of the city’s financial burden stems from a combination of land purchases as part of the long-range plan for the city, buying right-of-way for Thurmon Tanner Parkway and getting less-than-expected revenues from the local option sales tax it shares with Hall County and other local governments.