Lebanon residents will face a property tax increase next year despite a last-minute objection from a councilor during the recent Lebanon City Council meeting.
The 41-percent property tax increase received “no” votes from councilors Joey Carmack and Fred Burton, who offered an alternative to the increase, which was rejected by councilors.
The increase will raise the city’s property tax rate from 60.75 cents to 85.75 cents per $100 of assessed value (25 percent of property value for residential properties). For a home assessed at $150,000, the annual tax will increase about $100.
Lebanon Mayor Bernie Ash said the council started the process with a $2.4 million shortfall, which it was able to reduce to about $1.8 million. He said with the proposed tax increase, and if all revenues for the upcoming fiscal year are accurate, the city could have a $91,000 surplus at the end of the fiscal year.
Burton proposed taking the $1.8 million from the city’s reserve account to cover the shortfall, or eliminate the $1.8 million from the budget. He also proposed an employee pay increase to 3 percent, and limiting city employee merit pay increases to 3 percent,
Lebanon Finance Director Stuart Lawson said the proposal would cost about $2 million to $3 million.
“This is bad business,” said Ash, who said it was not wise to use reserve funds for reoccurring expenses. “What are you going to do next year?”
Burton said the city should see additional revenues next year because of census growth and other avenues.
“I don’t think it would kill our reserves that much for this year to offset the tax increases,” Burton said. “To me, it’s just a fair thing to do for the people. That’s what we’re down here to do is protect our constituents that we serve.”
Burton highlighted the recent purchase of the Mitchell House and land on Highway 231 for a sports complex, which Ash noted were not reoccurring expenses.
Burton’s motion ultimately failed, while the council passed the budget and accompanying tax increase.