After one month of meetings and discussions, the Budget Committee has approved the draft 2016 Jefferson City budget, which now will be considered by the full City Council for final approval.
At the Budget Committee meeting Thursday, council members made several changes to the draft before unanimously passing a balanced $30 million general revenue budget. The council can still make changes and further discuss the draft at the next council meeting Sept. 8, where council members are expected to take the bill to approve the budget off the informal calendar for final action.
Though a motion was made by 4th Ward Councilman Carlos Graham to keep the gross receipts utility tax, or GRUT, rate at 5.65 percent, it failed by a 9-1 vote. The draft budget currently has a proposed GRUT increase to 6 percent, which is estimated to raise $294,241 in new revenue, which would be used to address the city's vehicle replacement and maintenance needs.
The city's gross receipts utility tax is capped at 7 percent; to increase the rate any higher would require a public vote. The telephone tax has remained at 7 percent for years, but the gas and electric taxes were lowered to 6.55 percent in 1982 and to 5.65 percent in 1984.
In deciding to increase the GRUT rate, several council members said they had not received the feedback from residents and businesses they had expected and the city needs new revenue to address a looming capital replacement issue.
"This tax is going directly towards maintaining the financial health of the city," said 2nd Ward Councilman Rick Mihalevich. "I haven't heard from people, haven't gotten the phone calls I was hoping to get for guidance."
Third Ward Councilman Bob Scrivner agreed, noting to increase the tax is the "fiscally responsible and fiscally prudent" thing to do.
Graham said he had heard from constituents concerned with increasing the tax rate and to increase it at a time when the city is preparing to ask residents to renew the half-cent capital improvement sales tax is not good timing.
"I'm just not ready to increase this GRUT tax," Graham said.
Other changes made Thursday include changing a proposed one-time salary adjustment of $600 per employee to a $900 one-time bonus for all employees and reinstating the fire training officer position. Both adjustments would be paid for out of funds previously identified for vehicle replacement and maintenance, though council members specified money for those replacements and maintenance could come out of the fund balance at a later date.
For a more detailed look at the latest changes to the 2016 draft budget, check the News Tribune on Sunday in print and online.