(Memphis, TN) Memphis city council members have approved a budget for the 2012-2013 fiscal year that includes a tax decrease but also dips into reserve funds and future retirees’ pension benefits.
The property tax rate will be $3.11 per $100 of assessed property value, down from $3.19. For a resident with a $100,000 home, this comes out to about a $20 savings per year.
The adopted plan is based largely on a proposal submitted by Councilman Harold Collins. After extensive debate and several amendments over the course of more than six hours, the council decided to use more than $19 million from a reserve fund and use $20 million from the OPEB trust, a fund for future retirees’ pension benefits.
There will also be a 1.5 percent increase of health care costs for city employees.
Cuts include closing golf courses during winter months that do not make profit, totaling a savings of about $42,000.
Public safety remained largely untouched, despite cuts to the fire department’s equipment scheduled for July. News Channel 3 has covered the removal of certain trucks from service over the last few months. Councilwoman Janis Fullilove tried to bring two ladder trucks back at the cost of $4 million, but the motion failed.
Other projects remain funded. Libraries will stay open, and maintenance for parks will receive an extra $800,000 than originally planned. Also, within capital improvement projects is $2 million for the stabilization of the old Chisca hotel building, before developers begin renovation.
A plan to install additional speed cameras was undercut, despite the advice that they would have generated a net profit of $700,000.
Many citizens spoke to the council, urging them to fund stabilization of the Chisca, to maintain funding for MATA, and keep taxes low.
Several other council members proposed their own plans, which involved a combination of using $9 million from the sale of the defense depot, OPEB funds, and reserve funds.
In the heat of the debates, Collins said that it would be Memphis suicide to propose a budget with a hole they can’t get out of.
Chairman Bill Morrison said that the adopted plan would not adversely affect the city’s bond rating.