The town of Mooresville will raise taxes by 5.5 percent and increase water and sewer bills under a new budget approved this week.
Commissioners voted 4-2 Monday in favor of the budget, with Chris Carney and Miles Atkins voting against it.
The $41.6 million general fund budget raises property taxes from 55 cents to 58 cents per $100 value. For the owner of a $250,000 house, the 3-cent increase would mean $75 more per year in taxes, or a total of $1,450.
The 3-cent increase is needed to help pay off debt service from voter-approved recreation and street bonds, interim Town Manager Erskine Smith has said.
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The proposed budget relies on $1.82 million from the town's reserve fund, although Finance Director Maia Setzer said she doesn't think the town would actually end up spending that amount. In recent years, the town has saved money during the budget year to avoid spending reserve funds.
Mooresville will still have a 28 percent reserve fund balance, which is like a savings account. The town has a policy to keep a fund balance of at least 20 percent of the general fund budget.
The money from the fund balance includes about $260,000 that commissioners added Monday night because they postponed making a change in the town's business privilege license tax. The anticipated revenue from the change had been included in the budget, but commissioners voted to continue a public hearing on the change to their August meeting.
The proposed change would tax most businesses 60 cents per $1,000 of annual gross receipts, with a minimum of $50. Currently the town charges businesses flat fees for privilege licenses, ranging from $2.50 to $500, depending on the type of business.
The town will raise utility rates $5.22 a month or less for residential customers who use 5,000 gallons of water a month or fewer – or 75 percent of residential customers. That's about an 8.6 percent increase.
In-town residential customers who use more than 10,000 gallons a month will see their bills rise $14.80, a 12.6 percent increase over last year.
The average in-town commercial user will see a 10 percent rate increase, or about $106 a month. Customers outside of town pay higher rates.
The increases will pay for improvements to water and sewer facilities.