Statesboro City Officials Unsure If Tax Increase Will Be Necessary

The Statesboro City Council continues to move forward with the proposed FY 2025 budget, but officials say it remains unclear if property taxes will need to increase.

Council held a public hearing Tuesday morning to hear public feedback on the FY 2025 budget set to take effect July 1, if approved by council. The hearing began with another summarization of the budget by City Manager Charles Penny, who noted that whether taxes increase or not, the city will pull funds from the fund balance in order to balance the budget.

Budget Highlights

The FY 2025 budget highlights include a 10% total decrease from FY2024, a 13.5% General Fund
increase, a balanced budget, and an increase to the sewer rates, tap fees, and aid to construction fees.

  • Total budget is $108,973,791
  • Operating budget is $55 million
    • 63% of this budget is personnel
  • Budget is less than FY 2024 due to changes in grants, ARPA funding, and GDOT funds.
  • Currently, it is based on an expected $8 million in tax dollars collected from property taxes.
    • Penny said that is less than the budget for the police department alone, which he said was about $11 million
    • Revenue trends reflect an 8% overall increase in General Fund revenues and a 12% increase in the property tax digest while franchise fees remain flat
  • The budget proposal requires use of $1.7 million in Fund Balance, which would drop fund balance below the required minimum requirement of maintaining 25% of the General Fund Budget in the fund.
    • This proposed budget based on current tax projections would leave the fund balance at 23%
  • Penny also said part of the increase in the budget is due to the pay plan implementation.
    • “You’ll see the full impact of the pay plan. The pay plan increase is $2.3 million. Any tax increase in revenue is needed to increase personnel costs. The other thing impacting the General Fund is the fire fund. That budget still falls short almost $1 million so we will have to account for that with all the fire operations that go in as well.”

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Possibility of Tax Increase

Penny told members of council that once the full tax digest is known, the city will have a better idea of whether or not a tax increase is necessary. “We won’t know until we get that.”

Statesboro’s current millage rate is 8.125 mills. A one mill increase for Statesboro would generate a little
over $900,000.

On a $200,000 home, with 40% of the value assessed for taxes at 8.125 mills, CITY property taxes are $633.75. If the rate is increased to 9.125, the property taxes will be $711.75, for an increase of $78/year.

$700,000 would still need to be pulled from the fund balance in order to balance the budget, but the fund balance would be left at 27%.

Councilwoman Paulette Chavers expressed her dissatisfaction with the possibility of another tax increase, citing that they should have done this before.

“I’m a little salty about it,” she said.

Councilman Phil Boyum replied that it’s possible that the city won’t increase taxes because of all the increased values and the ‘exploding growth’ that is happening in the area.

“It’s a possibility. It’s kind of semantics. If we don’t roll our taxes back, then we are raising taxes,” Penny said, referring to the fact that with higher assessments, the city will collect more money because property owners will pay more based on the higher valuation.

No one from the public was present to speak for or against the budget as proposed.

Budget adoption is set for the June 18th council meeting.

Jessica Szilagyi

Jessica Szilagyi is Publisher of TGV News. She focuses primarily on state and local politics as well as issues in law enforcement and corrections. She has a background in Political Science with a focus in local government and has a Master of Public Administration from the University of Georgia.

Jessica is a "Like It Or Not" contributor for Fox5 in Atlanta and co-creator of of the Peabody Award-nominated podcast 'Prison Town.'

Sign up for her weekly newsletter: http://eepurl.com/gzYAZT

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