Chesapeake real estate tax holds at $1.04

CHESAPEAKE

The City Council unanimously approved a 1-cent cut in the mosquito control commission tax rate but held the real estate tax rate at $1.04 per $100 of assessed value, after top administrators cautioned that any further rate cuts could affect city services and staffing levels.

Council members applauded City Manager William Harrell for drafting a budget that calls for spending $9.3 million for employee raises but only increases core government spending by $1.5 million.

"I think the budget attempts to address all the needs that are out there while also being fiscally conservative," Councilman John de Triquet said.

The $963.2 million budget was Harrell's first as the city manager.

Most residents' real estate taxes will not go up as dramatically as in the past few years. Home assessments will rise an average of less than 1 percent this year, and even fell in some neighborhoods that have seen huge property value increases over the past few years.

Maybe that's why Tuesday's budget hearing had virtually no public speakers. Dozens attended last year. Many attended a busy rally hosted by a group called the Chesapeake Citizens for Fair Real Estate Tax.

Home assessments rose by an average of 10.2 percent last year, and by an average of 28 percent in 2006. To lessen the tax blow, the council slashed the rate by 5 cents last year and by 12 cents in 2006.

While there was little disagreement this year over the budget and tax rate, the council did get hung up for more than an hour in deciding how to spend several million dollars left over from a previous fiscal year.

The council eventually voted to use more than $15 million of that leftover money to fill shortfalls in the general fund revenue, install a new human resources and payroll system, and do other projects.

Mayor-Elect Alan Krasnoff lobbied to spend about $10 million of that $15 million and hold onto the rest.

"This may not be the time to invest all of those funds," Krasnoff said. "I don't know if you're going to see those kind of end-of-the-year funds next year."

All of the council members were pleased with Harrell's eye for tightening. He has already imposed a hiring freeze. And just a few weeks ago, he began a policy that will mandate his office to conduct a strict review of any city procurement over $5,000.

Over the next year, Harrell will ask all city employees to try to identify savings of $3,000 each. If they do, that alone would be enough to pay for the $14 million second phase of an employee pay plan that the council is committed to fund.

City officials recommended some last-minute fund movements to fill community needs, including keeping libraries open on Sundays, which will cost $88,000.

Top city officials also recommended cutting a City Council contingency fund to $50,000 from $100,000, so that two animal control technician positions can be added to the Police Department. The council also voted to increase the administrative fee for building, electrical and mechanical permits to $40 from $35.

Mike Saewitz, (757) 222-5207, mike.saewitz@pilotonline.com