Despite a growing economy, the city of Charlotte is facing a $21.7 million budget gap. City leaders say it’s bigger than anything they dealt with during the great recession. Tonight, City Manager Ron Carlee will lay out his plan to fill that gap when he proposes his budget before the city council.
Some layoffs and cuts to city services seem likely. But just how much will be cut, and how many will lose their jobs may depend on trash.
Charlotte was actually expecting to turn a small budget surplus this year. But the budget went nearly $22 million in the red after a redo of the botched 2011 revaluation of property led to much lower tax receipts than expected. Plus, the General Assembly killed a tax that cities charged businesses to operate inside their borders. At a recent budget meeting, City Manager Ron Carlee suggested raising fees, cutting city budgets by $4 million along with other cost-saving measures.
But that's isn't enough to balance the books. So, Carlee said it was time to get creative. He told council members to fasten their seatbelts.
He pointed out a fee paid by property owners "that could be converted to a tax."
Yes, he is talking about a property tax increase, but this one, Carlee says would, "actually lower the amount of money that most residential people pay as well as generate significantly more revenue."
"Specifically," Carlee said, "we’re talking about the $47 annual solid waste disposal fee."
Every homeowner in Charlotte pays $47 to the city each year to help cover the cost of crews that dump your trash cans each week.
Carlee floated the idea of changing the flat fee into a 1.5 cent property tax increase. If your home is valued around $320,000, you’d pay $47 a year, the same you actually pay now, says Carlee.
"Now obviously those above it would pay more."
But for those with homes valued around Charlotte’s median of $151,000, "they would see a $24 decrease."
This, said Carlee, would actually generate $4.5 million more than that flat fee. And do more. Mecklenburg County pays its municipalities their share of the county sales tax based on how much in property taxes each collects. This would count as a property tax increase, so Carlee told the council members "you have the opportunity to increase both property tax receipts and increase sales tax receipts."
All told, this plan could generate an additional $6.4 million for the city.
That doesn’t mean the plan was greeted warmly. Take this reaction from Mayor Pro-Tem Michael Barnes, who said he had no interest in voting for a property tax increase of any kind.
"What I wanted to see is the analysis showing us cutting our way out of this problem."
Tonight, Barnes will see proposed cuts. Even if the trash plan is approved, a budget gap of $5 to $7 million dollars remains. That piece of the puzzle, Carlee said, would likely come from cuts to city services and possible layoffs.
This is an election year for city council and mayor, which means council members will have to weigh their preference: Being on the record for deeper cuts or a tax increase. A vote on the budget is scheduled for June 8.
