The City of Cookeville is proposing a 7-cent increase in property tax for the upcoming fiscal year.
The tax increase proposed during Wednesday afternoon’s budget workshop. City Manager James Mills said the increased rate will provide an additional $850,000 in revenue. Mills said the property tax hikes will help keep city employees at competitive salaries, expand services, and prepare for economic uncertainty.
“Nobody likes to do property tax increases,” Mills said, “I don’t. I live in the City of Cookeville, I don’t want to pay more taxes. But I also see what we’re enforcing and you guys are too. You see where your tax dollars go, and I would argue with anybody we spend our tax dollars wisely. We’re good stuards of taxpayer dollars.”
The City beginning its budget process with a $5.3 deficit. Mills said the city projects some $39.6 million in total revenue, with expenditures totaling some $45.7 million.
Under the proposed increase, property taxes on a $250,000 home would jump from $575 to $618.75 annually. Mills said next year, property values in Cookeville will be be reappraised.
“Part of the reason I point this out is because, when we are reappraised next year, you’re going to see our tax rate drop down, I’m guessing, to the 60’s,” Mills said. We could drop around 30 cents.”
Mills said similar cities across the state have seen similar drops after their reappraisals this year.
Mills said the city plans on adding seven new full time positions, including one firefighter. Mills said two positions will be cut, one of which is a result of last year’s Energy Division merger. Mills said the city pay scale will be adjusted by $2,000. Some 72 percent of employees will get a raise of over 3 percent.
“We’re just trying to stay competitive with the county, and I never thought I’d say that,” Mills said. “But we’ve got to keep doing pay increases to help quality employees, and for retention.”
Mills said the city plans on giving paramedics an extra $300 per paycheck, which would increase costs by $50,000 for the 16 paramedics.
As for revenue, Mills said the city projects sales tax revenue growth of just two percent this year.
