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Possible Tax Hike in City of Huntsville

City of Huntsville still  undecided on whether property taxes will increase.


 

On Tuesday night the Huntsville City Council missed an opportunity to make clear that it did not intend to raise property taxes this year.

Instead, the Council was asked to “consider approval of announcing the City Council’s intention to adopt a maximum property tax rate of $0.4106 per $100 valuation for the City’s 2015 – 2016 Fiscal Year.”
As requested, The City Council did consider that idea and agreed by a vote of 8–1 to make such an announcement. It was noted by the Mayor that this is not the final decision on the tax rate, only a public announcement that it will not exceed the current rate.

At a previous meeting on the proposed budget held a week earlier it was revealed that the recommended City budget assumed a continuation of the current $0.4106 per $100 of property valuation as assessed by the Walker County Appraisal District (WCAD). This amounts to a real tax increase of 4% for an average Huntsville property owner, since the average assessment of City property by the WCAD has increased by 4% over last year.

For an average property owner to be taxed at the same level as last year the City’s tax rate should be lowered by that same 4% to about $0.3948 per $100 of evaluation. This rate is referred to as “The Effective Tax Rate.” It has been standard practice for many previous City Councils to lower the tax rate every year by that amount to avoid placing more tax burden on the taxpayers of the City.

This same proposed City Budget contains a recommended pay increase for City employees of 7.5% as well as setting aside approximately $900,000 for “economic development.” It also contains a much larger amount of “Unallocated Reserves” (spare cash) than has historically been considered necessary to operate the City.

Our Opinion
We oppose any increase in property taxes for the City of Huntsville. The tax rate should be lowered to the “Effective Tax Rate,” if not lower. To consider raising all City employee’s salaries by 7.5%, stashing almost $1 Million in a murky “economic development” fund, and hoarding several more million dollars as “reserve” funds at additional cost to taxpayers is not sound financial planning.

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