Annapolis Mayor Joshua J. Cohen has introduced a $95.4 million operating budget for the next fiscal year, a proposal that would raise the property tax rate along with some fees for residents as the city moves to invest in its infrastructure and personnel while continuing to shore up its reserves.
The proposal, submitted to the City Council Monday night, would increase the property tax rate by nearly 10 cents per $100 of assessed value and impose higher costs to city residents for bus fares, water and sewer services — levies that one alderman said would drive away middle-class residents.
The proposal would also eliminate employee furloughs, allow the city to hire 10 employees and increase city funding for police and fire retiree benefits. It would also add $4 million to the city's reserves.
Cohen, a Democrat, called his budget proposal "responsible and reasonable," though he acknowledged that a rise in the bus fare, for example, "gives a lot of us heartburn."
"I think these fee increases are reasonable, given what we're facing," said Cohen. "No one wants to pay more taxes. But it allows us to continue addressing some long-term liabilities. …We still have work to do in order to shore up our overall financial picture. … We're making concrete progress."
If the proposal passes the council, it would be the second consecutive year the city has raised fees. Water and sewer fees would increase by 2 percent after rising by 75 percent last year. Bus fare would increase to $2 — representing a $1 increase over the past two years. Service would expand to Edgewater and Eastport.
The property tax rate would grow by 9.83 cents per $100 of assessed value, or from 56 cents to 65 cents — a 4.5 percent hike. Seven cents of the increase would allow the city to maintain its current yield. The owner of a house valued at $325,000 would see its tax bill raised by about $81.
The council must approve a final spending plan by June. Alderman Frederick M. Paone, the council's lone Republican, said he was "skeptical" of much of the data in the mayor's proposal.
"I certainly dispute a number of his figures," said Paone, of Ward 2. "It's so far out of whack with inflation. It makes no sense."
Alderman Richard E. Israel, a Ward 1 Democrat, said it would be a "real challenge" to pass the budget as proposed.
"I think we should cut expenditures before we increase the tax rate," said Israel. "We have to consider the taxpayers. We're driving out the middle class. People can't afford to live in the city."
There would be several changes to the city's trash collection service, including decreasing service from twice to once weekly, discontinuing vacuumed leaf collection and a staff reduction of six, which Cohen said could likely be achieved without layoffs. The household fee would drop by $48 to $378 annually, an 11 percent savings.
The spending plan also calls for an increase in replacement funding for the city's fleet of vehicles — from $300,000 to $1.1 million — and a 4 percent increase in the city's contribution to both the police and fire departments' pension funds, which represents a cost of $741,000. The city would also dedicate $600,000 for a new sidewalk fund and double the amount allocated to the retiree medical insurance trust fund to $200,000.