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As council tries to fund raises, tax increase may be unavoidable

By By Sheila Blackmon/The Meridian Star
Sept. 3, 2001
As Meridian city councilmen prepare to approve what could be a 5 percent tax increase, they also have been scrambling to trim spending and find money for a city employee pay raise.
Ward 3 City Councilman Barbara Henson said several council members are looking at ways to give employees "some sort of raise." She said that personnel director Gary Matlock also is trying to keep insurance costs down.
But she said an increase in city property taxes may be unavoidable even if employees don't get raises.
Henson talked about the possible tax increase, city employee pay and Meridian's annual budget during a meeting last week with The Meridian Star editorial board. City councilmen must approve a new budget by Sept. 15; the next fiscal year starts Oct. 1.
City taxes
Henson said that the city's tax rate has remained unchanged the last four years after dropping slightly in 1997. At the same time, she said, the city payroll has increased from 40 percent of the budget in 1997 to about 62 percent today.
Henson said the city historically has received more money from sales tax revenues than from property tax revenues. She said property tax revenues continue to decline.
Meridian could see an increase in sales tax revenues from a planned Lowe's store near the Wal-Mart SuperCenter, she said. But she added she didn't think the new Wal-Mart will increase sales tax revenues.
Also contributing to the city's problems is an increase in electric rates and employee health insurance. Besides that, she said, retiring employees also can affect the budget by cashing-in unused personal leave.
Reduce expenses
Henson said that the city council is considering several ways to trim expenses: reduce paid-time-off for employees who have worked less than a year, cut the city's $49,350 travel budget by 10 percent and stop employees from driving city vehicles to and from work.
Money also could be saved with reduced group rates on cell phones, Henson said, although many employees and leaders already purchase their own phones. She said the city could close police precincts, and councilmen could cut contributions and grants.
Of the $469,700 in contributions that groups and organizations have requested next year, Henson said $275,000 will be funded if that much. She said that figure is down from $290,000 the city gave this year.
Funding requests
Henson said that some funding requests from the Meridian Transit System, Multi-County Community Service Agency and East Mississippi Business Development Corp. are "big ticket things."
Meridian Transit is requesting $155,000 next year, up from $141,700 it received this year. The MCCSA is asking for $50,000 next year, up from $9,400 it received this year. EMBDC wants 1 percent of the city's sales tax revenues and the State Games of Mississippi wants $7,500.
Henson said another $270,000 could be freed in the city's budget if Lauderdale County supervisors take over the city's animal control operations, which now falls under the police department.
Meridian's tight finances could mean that some abandoned houses won't be demolished, positions will be left unfunded, the Police Department won't have new vehicles and the Parks and Recreation director won't be able to bid on softball tournaments.
Sheila Blackmon is a staff writer for The Meridian Star. Call her at 693-1551, ext. 3275, or e-mail her at sblackmon@themeridianstar.com.