City Budget Includes Tax Increase For Infrastructure

WATER VALLEY – The public is invited to weigh in on the City of Water Valley’s proposed 2020-21 fiscal year budget and tax levy during a hearing scheduled on Sept. 8. The budget includes a two mill tax increase, pushing the city’s tax levy to 41.50 mills. The additional two mills will generate an extra $36,000 in what city officials described as a longterm plan for small, incremental tax hikes to invest in the city’s aging infrastructure.
Described as flat, with revenue and expenditure projections comparable to the current fiscal year with the exception of the tax increase, aldermen unanimously voted in favor of adopting the proposed $3,268,546 budget following discussion during a special meeting held on August 10. The discussion included sales tax projections (see related story, page 3), reviewing each department’s expenses and a look into the future infrastructure needs.
“As everybody knows this year has been totally unpredictable,” Mayor Donald Gray noted as the discussion got underway.
“Actually most of our departments are under budget, especially in salary. The main reason is we haven’t been fully staffed for most of this year,” Gray explained. One example cited was only 53 percent of the budgeted amount has been spent for personnel in the water and sewer department with three months remaining in the current fiscal year that ends Sept. 30.
“This is a department that is constantly struggling with staffing. We have said many times that we need to increase the wages because our goal with the number of employees is never reached and we cannot retain personnel… this is a trend that we see every year,” Ward One Alderman Kagan Coughlin noted.
Gray added that he spoke with water and sewer department head David Floyd earlier in the day.
“We talked about how to look for quality workers and paying them what a quality worker deserves. He is like the rest of the departments, he wants those type of workers. Trying to find them is the big problem we face,” Gray told the board.
The water and sewer department was also cited as an example of the cost to keep the city’s aging infrastructure operating.
“They are under budget for their salaries, but have actually gone over in some other items,” Gray explained, adding that some major purchases were on hold until the new budget year.
“I can’t tell you the number of pumps, work at the lagoon and things like that which have been an additional expense,” the mayor continued.
Following the department scrutiny, the topic shifted to the tax increase after Coughlin noted the budget does not address the city’s infrastructure debt.
“I made this statement probably three years ago, while we enjoy grants and most small cities thrive on them, we cannot continue to count on them forever. Sometimes you have to do things to make sure that you can keep the city operating at the level that our citizens expect of us,” Gray said.
“So I am happy to be the person who pushes this. There are items that we need to replace, the electric department is one of the bigger ones. We have grown to adjust to the fact that our power blinks in this community more regularly than it should. We have lots of old poles, not every pole falls over when it gets hit by a car unless it is 60 years old,” Coughlin said, adding that it will take more than a tax increase to update the city’s electric grid.
“Our sidewalks that everybody trips over. We don’t invest in them because just keeping the lights on is our top priority,” Coughlin added before asking when the last time the city’s millage rate has increased.
“Twenty-two years,” City Clerk Vivian Snider answered.
“We need to do it incrementally, start slowly creeping things up to cover what we know our bills actually are and coast on the investment of our parents. We need to do something for our kids so that our  city will be in better shape when we leave. I would push for a modest increase in our millage rate. Because a flat budget every year means that we are slowly watching our town deteriorate,” Coughlin continued.
“No one likes it, I get it. But I think if people understand why… It is kind of like the school tax, the bond, that passed overwhelming. Because people understood our kids are important, education is important,” Gray noted about the 2019 referendum where 93 percent of the voters favored a tax increase to fund a $6.5 million project for improvements at the schools. “So I think if we do a better job of communicating to the people why we are doing things, they accept it better. Again raising taxes leaves a bitter taste in my mouth, but I know where you are coming with this,” Gray said.
Coughlin then made the motion to adopt the proposed budget with the two mill increase.
“Which is what we discussed last year. (We said) if we had a flat budget (this year), this is exactly what we would have to do,” Ward 3 Alderperson Cinnamon Foster agreed about the tax increase.
The public hearing for the budget on Sept. 8 will be held at city hall at 6:30 p.m.

Budget Notes
• The proposed tax millage increase means you will pay more in ad valorem taxes on your home, automobile, vehicle license tag, utilities, business fixtures and equipment and rental real property.

• The mill rate is a tax rate – the amount of tax payable per dollar of assessed value of a property. In property tax, 1 mill is equal to $1 in property tax levied per $1,000 of a property’s assessed value.

• Even when the millage rate stays the same, taxpayers will often see an increase in the amount of taxes they pay on some property. For example, if the assessed value of your property increases, you will pay more taxes even if the tax millage rate remains unchanged.