WALLA WALLA — A property tax hike that includes use of banked levy increases passed 4-3 at a City Council meeting Wednesday night.
The tax-raising ordinance was a follow-up to a resolution approved by Council two weeks ago, when members debated heavily on whether they should move forward with a 3.8 percent banked levy increase that would cost the owner of a $160,000 home and additional $13 in taxes next year. That hike was on top of an allowed 1 percent increase also approved by the Council.
Council Members Shane Laib, Ron Plucker and Conrado Cavazos voted against the increase, with Laib and Plucker questioning if the city could make better use of $4.03 million in vehicle replacement funds.
City Manager Nabiel Shawa and Council member Barbara Clark noted, however, that a large portion of the vehicle replacement fund derives from and is dedicated to enterprise funds, such as trash and water, and cannot be used to boost the general fund.
Next year the city will put $250,000 into its vehicle replacement fund and another $275,000 in 2014 to cover costs for new police cars, lawn mowers, fire trucks and other vehicles.
The last two years, however, city officials forwent putting money into the fund because of budget shortfalls and a poor economy.
Faced with yet another two years of shortfalls and a slow-to-recover economy, Laib and Plucker questioned if the city should again forgo putting money into the fund and instead give residents and business owners a tax break by not taking the banked levy capacity.
“I own my own small business and it (the economy) isn’t great, and I don’t have a vehicle replacement fund that I can go into” Laib said.
The property taxes approved by Council members Mayor Jim Barrow, Barbara Clark, Jerry Cummins and Mary Lou Jenkins include a 1 percent regular levy increase allowed by state law that will net the city an additional $47,697.
The 3.8 percent banked levy increase will net the city an additional $185,228 next year.
The Council also approved increases for new construction and annexations, which will net the city an additional $24,000 next year but won’t increase tax rates paid by property owners.