The decline in the property tax digest, which drives property tax collections, would affect the Cartersville School System's appropriation, which was more than $15.5 million last fiscal year. Officials had been preparing for a "very slight" increase of $6 million in the city's portion of the digest, which would have equated to an appropriation of more than $17 million to the schools, or more than $1.5 million over last year.
"The budget as proposed was based on information we got from the tax office. Since that time, we've now got new updated numbers so the budget will be decreasing some. What has happened is the tax digest was expected to stay at or slightly increase from the 2009 tax digest level and, Thursday of last week, we got some updated information from the tax office that the tax digest actually decreased and not increased or remained at the same level. As a result of it decreasing, our tax digest has fallen, which basically tells us we're going to have less dollars coming in for taxes," Rhinehart said, adding the change will likely mean "a small decrease for the city, but the city school piece of our budget is a very large item. It will have a large impact for the city school system."
In February, The Daily Tribune News reported the results of a city leader visioning session, which included discussions about the possibility of employee furloughs or layoffs. Rhinehart said although the fiscal year 2010-2011 proposed budget includes no personnel expense cuts, it also incorporates no salary increases. In a presentation at the May work session, staff members proposed an increase of about $174,000 in employee expenses, which Rhinehart said includes health care and pension plan costs.
Staffing numbers would not increase with the proposal, with the city employing 344 people, down one from last year. In 2009, the number of employees topped out at 367 -- that was before early retirements and across-the-board 16 percent expense cuts.
The proposal also includes a more than $1.1 million increase in capital expenditures, the largest of which is the purchase of a fire engine. Rhinehart said the apparatus is estimated to cost $500,000, with the remainder slated to go toward smaller replacements of various equipment.
With the downturn in the economy, several capital projects -- infrastructure or road projects funded by Special Purpose Local Option Sales Tax dollars -- have been put on hold.
In addition to increased costs of operating the Water Department, the proposed budget accounts for a $326,000 increase over last year in the purchase of commodities -- gas and electricity purchased from vendors to sell to the city's customers.
The increase in water and sewer rates would likely equate to an extra $1.50 per month on the average residential customer's bill based on the use of 7,500 gallons.
Rhinehart noted the proposed plan includes no service reductions. It is set to go before the mayor and council for a first reading Thursday and second reading and possible passage June 17.
Since the economic downturn, the city's finances have taken a dive, topping out at $169.5 million in 2009 after steady increases since 2005.