This Monday, the Sugar Hill City Council will vote on a proposed budget that keeps the property tax rate at its current millage rate.
I won't try to explain a mill, but it boils down to this: Under the proposed rate, property taxes on a home valued at $100,000 will run roughly $100.
Since 2001, Sugar Hill has held the line on property taxes. And even though the tax base for municipalities and counties is flat, town leaders have chosen to forgo a tax hike.
Given the current economic recession and the dwindling tax base of community coffers across metro Atlanta, Sugar Hill's financial peace of mind begs a question:
What do leaders in this town of 17,000 practice that those in other communities neglect?
When life is good people tend to be cheery, so Sugar Hill city manager Bob Hail bubbled with enthusiasm about this north Gwinnett town. The former Kennesaw city manager and retired Air Force colonel has been in town since 2001.
Hail reiterated one point repeatedly: He, the mayor and the five-member City Council share a philosophy regarding budget and big-ticket spending. Their approach is the antithesis of so many communities that want things bigger, better and yesterday.
Simply put: A city, county or any municipality has to live within its financial means. They can't spend what they don't have or can't replenish within a reasonable time frame. They should think hard about borrowing money and selling bonds time and again to finance projects. Be it peachy economic times or shaky ones.
If leaders aren't brass enough to put the kabosh on building baseball stadiums and other monstrosities, then debt will most certainly be a hangman's noose when the economy sours.
In Sugar Hill, City Hall has adopted a pay-as-you-go creed.
"All the things we do are with cash," Hail told me. "We paid off all of our long-term debt in 2002 and we haven't gone into debt since then. Our vision of growth has been scaled back, but not our day-to-day operations."
Naturally, the city receives SPLOST (special purpose local option sales tax) money, which helps pay for recreational and transportation projects. Pirkle Park is under construction; E.E. Robinson Park will be expanded. Sugar Hill's 10-year road replacement program ensures that every road and street within the city limits gets resurfaced.
"We've been doing $450,000 of road improvements in our city a year since 2002," Hail said. "We leverage SPLOST as much as we can. The city doesn't need debt during hard times and the reduction of its tax base. You still have to pay that debt service."
So these days, instead of fretting about cuts, debt payments and bond ratings, Sugar Hill officials can talk about the continued repair, maintenance and improvement of its infrastructure. They can review the capital improvement plan and discuss whether to proceed with some projects or hold the line.
Their philosophy: If we need it, save for it or see if there's a better price. When projects are built, they are paid for on Day One.
Town officials adopted this approach to government back in late 1990s, said Mayor Gary Pirkle, who was a council member then.
"It got so bad we had to take out a loan on taxes that would be collected to get through the year," he said. "The only thing we could hang our hat on was 100 acres of land that we sold, and revenue from our gas system. Certainly a combination of things have gotten us to where we are now, but we got out of an extreme situation."
And it appears there's no going back.
Rick Badie, an Opinion columnist, is based in Gwinnett. Reach him at rbadie@ajc.com or 770-263-3875.
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