Budget Pieces Could Move Wednesday

For parliamentary reasons, Wednesday could be an important day in City Council's effort to pass a budget, set the property tax rate and find money for the financially-hobbled schools.

Council has just three regular meetings scheduled before the summer recess, which is slated now to begin on June 20. Council has until June 30 to pass a budget, so a meeting could be added on June 27, if necessary.

If the members intend to stick to the current schedule, however, they may want to begin moving the major budget pieces out of committee on Wednesday. That way, the bills could have a first reading at Thursday's regular Council meeting.

Giving bills a first reading on Thursday would enable Council to make changes, if necessary, on June 13 before final passage on June 20.

The most prominent legislation still in committee – other than the bill establishing the city's operating budget – is Mayor Nutter's proposal to set a property tax rate at 1.3204 and a homestead exemption at $15,000. Current law would establish the exemption, which is deducted from the assessment of eligible homes before the tax rate is applied, at $30,000.

At the 1.3204 percent rate and $15,000 exemption, a home worth $100,000 would be taxed on $85,000 and owe $1,122.34.

Council leadership and the administration undoubtedly have been negotiating the details on where the rate and exemption should be set – and what would have enough support to get the nine votes necessary to pass.

There are also bills in committee that would phase-in changes in tax bills coming from Mayor Nutter's property tax reform, the Actual Value Initiative (AVI), and bills that would defer portions of large increases due to AVI.

The committee also could weigh a bill Wednesday to increase the liquor-by-the-drink tax, part of Nutter's strategy to raise money for the schools. Last week, the committee voted out a bill to create a cigarette tax, another part of the mayor's school funding plans. Both taxes would require the state's approval.

The committee also could take a vote on Councilman W. Wilson Goode Jr.'s bill to cap the 10-year tax abatement on new construction at $250,000, meaning an owner would pay tax only on the value of a home above that amount. The abatement now covers the full value of eligible new homes, though owners pay taxes on the value of the land.

All of these bills reside in the Committee of the Whole, which includes all Council members. There is not another meeting of that committee now scheduled.

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