Mayor's 5-cent property tax reduction plan left intact

The Beaverton City Council will consider a proposed 2011-12 city budget at its Tuesday, June 21, meeting at Beaverton City Hall, 4755 S.W. Griffith Drive.

The Budget Committee approved the $174 million budget Thursday evening, June 2, at its third and final regular meeting for the 2011-12 fiscal year budget process.

Following mostly routine presentations by individual department leaders, several committee members expressed concerns about Mayor Dennis Doyle's proposed 5-cent property tax reduction.

They questioned whether the proposed drop - from $4.20 per $1,000 assessed value to $4.15, a $10 savings for the average homeowner - was a meaningful, sustainable discount or insignificant gesture amid a still-uncertain economy.

Bringing up the recent $14 increase in city water rates, Councilor Catherine Arnold argued that residents who voiced objections to that raise in rates should approve of a similar amount being reduced from their property tax rates.

'It is a relatively small amount of money,' she said of the water rate increase. 'Now we turn around and say $10 (discounted) doesn't really matter. For 10 bucks, I say we should do it.'

Concerned that the tax discount might not last beyond the upcoming fiscal year, Arnold asked city Finance Director Patrick O'Claire to project revenues several years into the future.

His budget projection, which he called conservative estimates, shows the $4.15 per $1,000 assessed value tax rate (discounted from the current $4.20) maintaining through the 2012-13 fiscal year.

The rate is projected to rise slightly, to $4.17, by the 2013-14 budget year.

Satisfied that the city can maintain a slight tax reduction at least for the near future, Arnold agreed to support the proposed budget.

Committee member Traci Stout, however, expressed distress that the city couldn't offer more relief to its citizens, many of whom she said she's talked with are unemployed or concerned about their future income.

Stout cast the lone vote against the proposed budget.

'This 5 cents is really a slap in the face,' she said. 'It's so frustrating. I'd like to see a lot more. The city should be a reflection of what's going on in the economy.'

Committee member Allen Dawson, however, said the economy is such that even a nominal tax break can provide relief.

'I'll take a $10 (tax) reduction. In today's economy, anything the public can get back' is helpful, he said.

In other budget items, a $9.3 million decrease between beginning and ending general fund balances in 2011-12 is the result of expenditures and losses including the following:

  • $3.8 million in capital infrastructure projects involving street, water, sewer and storm drain systems;
  • The aforementioned $392,000 decrease in property tax revenues;
  • A $590,000 drop in interest earned from the city's investment portfolio;
  • Indirect support of the building and library funds, $157,596 and $351,969, respectively;
  • $310,000 in non-routine building maintenance, including security system replacements and replacing the library roof to accommodate solar energy panels funded through a $110,00 federal grant;
  • $203,000 for a parking lot facility at First Street and Main Avenue;
  • $300,000 for continued appropriation to acquire property beneficial to the city as it becomes available;
  • $1.8 million for seven funds related to one-time expenditures, including a $200,000 decrease to the library fund, attributable to the branch library's operations; and a $521,000 reduction in the Capital Development Fund for land-banking property purchases.
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