A Richmond City Council committee made a recommendation Thursday to reject a tax-rate cut proposed by Mayor Dwight C. Jones that could have resulted next year in a $20 reduction for a home assessed at $200,000.
The council’s Finance and Economic Development Committee voted 3-0 to recommend keeping the property tax rate at $1.20 per $100 of assessed value. The committee also recommended denial of an ordinance introduced by the mayor that would lower the rate to $1.19 in response to rising tax assessments.
The recommendation still has to go before the full nine-member council. But the committee that rejected the tax cut includes two veteran council members who are usually allied with the mayor, which makes a reversal by the full body uncertain.
Councilwoman Kathy C. Graziano, 4th District, said it would be “fiscally imprudent” to cut the tax rate in light of funding needs and potential cuts coming from the General Assembly.
“We have police and fire. We have employees across the board who have not received a raise in a couple years,” Graziano said. “We have a retirement system that needs to be funded. We have schools. We have our infrastructure.”
City officials are re-examining the tax rate because of assessments that rose by more than 1 percent, which triggers a state law requiring the city to roll back the tax rate to about $1.19 or have a public hearing and a vote to keep the rate the same.
Because the value of Richmond real estate increased by almost 2 percent in July assessments, keeping the rate unchanged means many Richmonders will pay higher taxes, which means more revenue for the city.
Each cent on the tax rate brings the city almost $2 million in annual revenue.
Councilwoman Ellen F. Robertson, 6th District, said that amount is enough to support the debt on a $30 million bond issue that could be used to address maintenance needs identified in Richmond Public Schools.
“We would be able to close that gap that we have right now that’s staring us in the face as it relates to school repairs,” Robertson said.
But her colleagues advised against laying out a specific use for the money in light of myriad needs and uncertainty in state funding.
“I think our citizens expect better at our schools. They expect better on our streets,” said Councilman Parker C. Agelasto, 5th District. “They expect better just about everywhere you go.”
The council is considering a range of three rates: $1.18, $1.19 and the current $1.20. The full council is scheduled to make a rate decision at its Oct. 13 meeting.
The committee also recommended that the council discuss funding priorities and make a future suggestion to the mayor about how the extra money should be spent. Because the new revenue would come in the current budget year, only Jones can introduce a budget amendment to allocate it prior to next year’s budget cycle.