Tax increase may be 4 cents

Havelock will budget down to the penny to save city residents 1 cent on the upcoming property tax increase.

Commissioners told the city manager to trim $90,000 from the general fund Monday night, balancing Havelock's $14.8 million budget with a 4-cent property tax increase and 4.4 percent water and sewer rate hike. The city staff's proposed budget called for a 5-cent tax increase.

When city projects are completed for less money than the board budgeted, the remainder is returned to the general fund. For each of the last five years, the amount returned was at least $290,000, according to Commissioner Danny Walsh.

"There is some small fudge factor put in," said Commissioner Will Lewis. "Instead of a serendipitous find at the end of the year - ‘Woah, look at that extra money' - we're just telling them to find it now."

The reduction is 1 percent of the $9 million general fund budget for 2008-09.

City leaders agreed to shave $90,000 off the budget by consensus, but Commissioner George Liner questioned the wisdom of reducing the tax increase. He said Havelock needs as much money as it can generate for future growth.

"If we don't do it this year, we're not going to do anything next year," he predicted. "We're never going to raise taxes during an election year."

Havelock's current tax rate is 49 cents per $100 in property valuation. The rate will likely climb to 53 cents next year, meaning an extra $40 in taxes on a $100,000 home.

The water and sewer rate increase would cost the average family using 5,000 gallons of water per month about $2.80 on the water bill.

A public hearing on Havelock's 2008-09 budget is planned for 7 p.m. June 9 in City Hall. Commissioners plan to adopt the budget at their June 23 meeting.

The board decided to tentatively budget $48,761 as a contribution to the Havelock-Craven County Public Library. City Manager Jim Freeman is scheduled to meet with Harold Blizzard, Craven County manager, to negotiate a proportional split between the city and county for library funding.

Havelock commissioners said they would agree to fund 35 percent of the library's annual budget if the county would fund 65 percent.

"The county's job is to provide libraries for the county," said Commissioner Danny Walsh. "This is an additional thing for the board of Havelock."

The Cunningham Boulevard library, which traditionally has received money from the city and county, reduced its hours last year after Havelock halved its annual contribution. The city later anted up with emergency funds, but officials resent being expected to pay what they consider an unfair percentage of the library's budget.

"This is a gift from the city of Havelock," said Mayor Jimmy Sanders. "It is not required. It is not even closely approached by other municipalities in Craven County as a percentage."

Commissioners tentatively approved a rate increase for rentals at the Havelock Tourist and Event Center that would prevent the city building from losing money on nonprofit events.

The tourist center currently charges nonprofit groups $400 to rent the full ballroom and $200 to rent half the room. Rates would increase to $500 and $350, respectively, under a plan presented by Kathleen Townsend, city director of administrative services.

Havelock had offered nonprofits a half-price discount on rentals, which cost $800 for the full room and $400 for half for the general public.

With estimated expenses, Havelock was losing money on the deal.

"If it costs us more to do business there, it should cost (groups) more - not the taxpayers," said Walsh.