NEWPORT CITY â€“ The Newport City Council Monday evening started looking at the 2012-2013 municipal tax rate. However, council members decided to wait before taking any action. The proposed rate is 1.1597, up three cents per $100 of assessed value.
The council, when working on the budget, thought the grand list was $256 million and set the budget as such. At the time, the council thought the budget was level-funded. It wasnâ€™t until this week city officials learned the taxable portion was actually $251 million. The reason for the change is that the state removed the tax increment financing, which is about three million, from the grand list. City officials also didnâ€™t take into account the veteransâ€™ exemption, about one million, and the land use exemption, about three quarters of a million.
Even though there are changes, the amount of taxes collected will not change and there is no increase in spending.
City Manager John Ward, Jr. told council members they could appropriate about $75,000 the city has in surplus to help reduce taxes.Â
â€śI am confident that weâ€™re going to have enough surplus; if you chose to, you could take $75,000 and reduce the municipal tax rate about three cents,â€ť said Ward. â€śAlternatively, you could leave it the way it is and the surplus will show up next year and thatâ€™s fine. We donâ€™t just spend the money just because itâ€™s a surplus, as you know.â€ť
The budget has $126,000 in the reserve fund.
City taxpayers need to have received their bills by mid-October.