East Point residents could soon pay higher utility bills, but lower property taxes to help fund the city’s $118 million budget for 2012.
Councilman Lance Rhodes believes the best approach is to lower the city’s property tax rate, but increase utility rates. Rhodes said water customers will pay an extra $21.50 per month, while electric customers will see an approximate $6 increase.
“For the past 20 years, East Point has relied heavily on the property owner to provide the largest percentage of revenue with no opportunity to allow the citizens to take part in controlling their own contribution. I believe the greater responsibility should be placed with utility users," Rhodes said.
He explained that residents who pay property taxes have no choice but to pay the bill, but utility customers can monitor consumption and lower the bill. Rhodes is proposing lowering the millage rate from 14.75 mills to 13.75.
Mayor Earnestine Pittman argued that since full property tax information has yet to be compiled, it’s too early to be calling for a decrease in property taxes.
“I know there’s a 20 percent drop in property assessments,” she said.
She believes the city needs to focus on cutting waste from the budget, rather than increasing utility rates for residents.
“Where is the shared pain and suffering? The residents are the only ones being told to reduce their spending,” Pittman said.
If the budget is approved with the utility rate hike, the city will use approximately $3 million in funds from the Municipal Corporate Trust fund to help make the city’s utilities self-sufficient. The fund was established in 1999 by MEAG Powers so that members would have revenue to offset anticipated costs associated with deregulation of utilities and other costs that may arise.
Rhodes, who anticipates the utilities becoming self-sufficient in three years, said lowering property taxes sends a positive sign to the business community. In past years, he added, funds were taken from the general fund to help prop up the utilities. If those funds are not used for utilities, Rhodes said more money could be spent for tangible projects, such as sidewalks.
Pittman maintains it’s foolish to drop the property tax rate, because residents would only see about a $100 annual decrease in their bill.
“They’ll be paying more than that in utility bill hikes. It’s just an insult to the homeowners,” she said.
The city will hold a public hearing on the budget at 6:30 p.m. on Monday at Jefferson Station.
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