A declining property tax digest expected to produce lower revenues has Oakwood officials looking at raising the tax rate in 2017 just to stay even with 2016 revenues.
Officials in the South Hall city are looking at raising the rate to 4.174 mills from 4, with 1 mill equal to $1 for each $1,000 in assessed property value, which is 40 percent of the fair market value minus exemptions.
For example, the owner of property with a $100,000 fair market value and no exemptions could see taxes go from $160 to nearly $167.
“I think the (tax rate) rollup would be the route to take right now,” Councilman Todd Wilson said during a work session Monday to discuss the budget, among other things.
Other council members agreed, with Sheri Millwood saying, “And there’s a minimal impact on each property owner.”
“I don’t think we need to stay where we are,” added Pat Jones in supporting the increase.
Council members didn’t take a formal vote on the matter, instead providing City Manager Stan Brown direction on how to prepare the 2017 budget, which takes effect Jan. 1.
A budget work session is set for 6 p.m. Oct. 10 at City Hall, 4035 Walnut Circle. The council is set for its first vote on the tax rate at the council’s regularly scheduled meeting at 7 p.m. that day.
“We’ll build the … budget around (the higher rate) and then we’ll lay out (at the work session) what would have to be cut if we stay with the 4 (mills),” Brown said.
Brown gave some basic details Monday on how budgets could look if the tax rate stayed the same and if it went up.
Under a budget supported by 4 mills, “we would not have any reserves set aside next year,” he said. “Next year would be a very lean year.”
The council is scheduled to give its final OK to the tax rate on Oct. 17, with tax bills set to go out Oct. 30 and taxes due on Jan. 1. The 2017 budget’s adoption is set for Nov. 14.