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Charlotte City Council considers smaller tax hike

The city of Charlotte’s $816 million capital program still appears to be on track.

But there is a movement on the City Council for a smaller property tax increase to pay for it. In exchange, many of the projects that are being planned – such as roads, sidewalks and police stations – will take longer to get built.

City Manager Ron Carlee’s recommendation is for a 7.25 percent property tax increase, to go into effect in July.

During a budget meeting Wednesday, six council members gave tentative approval to a smaller 6.4 percent tax hike.

Democrat David Howard pushed for the smaller increase, citing council member’s concerns last year about hurting residents with too steep a hike.

“If it’s about lowering the rate, then we should do anything we can do,” Howard said.

Under both plans, a tax hike would go into effect in July. Voters wouldn’t be asked to approve bonds for projects until November 2014. There also would be bond referendums in 2016, 2018 and 2020.

If the larger tax hike is approved, the owner of a house with a taxable value of $200,000 would pay an additional $63.40 a year in city taxes. The city’s property tax rate would increase from 43.7 cents to 46.87 cents.

If the smaller tax increase is approved, the owner of a $200,000 home would pay an additional $55.60 a year. The tax rate would increase to 46.48 cents.

Under both plans, there would also be higher water and sewer bills, and higher stormwater fees.

Wednesday’s meeting was a chance for council members to change the capital and operating budgets. An idea only needs five votes to move forward. The smaller tax increase was given a tentative approval with six votes.

Democrat Claire Fallon asked city staff members whether the property tax rate could be lowered if $63 million in reserves were applied to the capital budget. Carlee has set aside that money to build a streetcar through central Charlotte, so long as the federal government gives the city a $63 million match.

City staff members said they would research how much that total would reduce the tax rate.

Council members rejected a proposal to cut $2 million a year from a new rental assistance program proposed by the Foundation for the Carolinas.

But council members did move forward a proposal by Democrat James Mitchell to cut $15 million from a $35 million cross-county trail, a planned pedestrian and bike path across Mecklenburg.

The next budget meeting is May 29.

Harrison: 704-358-5160
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