Buena Vista’s proposed real estate tax hike is expected to be reduced by half when City Council adopts a budget tomorrow, Thursday.
Mayor Tyson Cooper came up with a plan that he presented to Council’s budget and finance committee last Thursday that calls for a 7-cent increase to the tax rate, rather than the 14-cent hike that had been proposed earlier. Under this plan, next year’s real estate tax rate would increase by 7 cents, from 91 to 98 cents per $100 assessed value.
The plan would remove half of the pay and benefits for the city manager, finance director, treasurer and the treasurer’s staff from the general fund and split these expenditures between the water and sewer funds. The justification for these shifts is that the persons in these positions spend about half of their time with work related to the water and sewer funds.
The reallocation of pay and benefits for these positions would be as follows – 50 percent from the general fund, 25 percent from the water fund and 25 percent from the sewer fund. Taking these portions of the costs from the general fund would result in general fund savings of approximately $299,000, which is equal to about 7 cents on the real estate tax rate.
The increase in costs to the water fund would be offset by lowering the amount of planned water infrastructure reserves for future capital improvements. The amount previously budgeted, 289,278, would be reduced by $151,056 to $138,230.
The increase in costs to the sewer fund would be partially offset by lowering the amount of planned sewer infrastructure reserves for future capital improvements. The amount previously budgeted, $52,238, would be deleted, as would the capital outlay budget line of $50,000.
The remaining amount needed, $48,662, would be taken from the sewer fund’s fund balance. Steve Bolster, the city’s finance director, noted that this is a one-time proposal and that the sewer fund’s net position, as of June 30, 2024, according to the city’s audit, stood at $323,577, or 25 percent of planned FY26 sewer fund expenditures – well above the 20 percent goal some localities strive to reach.
In making his proposal to reallocate pay and benefits for certain positions, Cooper pointed out that prior to fiscal year 2025, the city manager’s and finance director’s pay and benefits were allocated in this manner.
In its meeting last Thursday, the budget and finance committee endorsed the proposed reallocations that would reduce the proposed real estate tax hike by 7 cents. No other changes were recommended to the proposed budget that City Council will consider adopting tomorrow.
