The Gainesville City Commission on Thursday finalized a 3.82 percent property tax increase and fiscal year 2022 budget that is $17.9 million larger than the 2021 budget.
Increased wastewater and electrical rates for Gainesville Regional Utilities, which go into effect on Oct. 1, also got final commission approval at Thursday’s special meeting.
The commission, by a 5-2 vote, increased the tax rate from 5.2974 mills to 5.5 mills. The millage rate is the amount a property owner has to pay per $1,000 of assessed value. Assessed value is typically lower than market value, and any tax exemptions are subtracted from the assessed value before the tax rate is applied.
So if the taxable value of a home was $100,000, the homeowner would have paid $529.74 in city property taxes in 2021 and will pay $550 in city taxes in 2022.
“Some folks would say keep the millage rate where it is and lower it and don't do those things,” Mayor Lauren Poe said at a special meeting on Sept. 13 when the new millage rate got its first public hearing. “That's a valid position and point of view. But I support all of those things that we've done, and I think they've made us a stronger city.”
The tax increase will generate approximately $4.3 million in additional revenue. The city will use the additional revenue in part to pay for $1.9 million in capital improvements and facility maintenance.
The 2022 budget also includes $750,000 to pay for Vision Zero, a program designed to reduce traffic deaths and injuries, and $350,000 for a new Youth Services Office.
In addition to the youth services hires, the budget increase will expand Gainesville Fire and Rescue’s Community Paramedicine Program and bring up the salary of lowest paid city employees to at least $15 an hour.
“All of these things I hope you agree were worth doing, but they do cost money and we have made the difficult decision that the value that our neighbors receive from all of these things outweigh the modest increase in the millage rate,” Poe said.
GRU customers also will pay 7 percent higher wastewater rates and 5 percent higher electrical rates for 2022, as part of a multiple year rate increase designed to improve the financial footing of the city-owned utility.
For consumers with average electricity consumption (800 kilowatts), their 2022 electric bills are expected to grow by $4.86 after the first year of the rate increase, according to a GRU presentation to the commission in May. With the rate increase, average wastewater usage (4 kilogallons) is expected to cost customers $1.72 more.
In addition to raising GRU rates, the city will lower the annual amount of revenue it takes from the utility—referred to as the general fund transfer. Starting in 2022, the utility will transfer $2 million less each year to the city.
The general fund transfer from GRU to the city was $38 million a year in 2021. By 2027, the general fund transfer will be around $26 million.
Each of the resolutions and ordinances related to tax rates, budgets and increased fees passed the city commission with the same 5-2 vote. Commissioners Desmon Duncan-Walker and Gail Johnson voted against each of the increases.
Johnson, who announced her resignation in August, will leave the city commission next week. She said during her resignation announcement that she chose her last day specifically to see the commission through its budget process.