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Gainesville plans to use its federal COVID assistance monies to lower property tax bills

Posted 12:44PM on Thursday 13th May 2021 ( 2 years ago )

GAINESVILLE – Property owners in the City of Gainesville are going to be the direct recipients of the latest round of federal funds being disbursed to help America’s cities deal with the financial impact of COVID-19.

That was the decision announced this morning at the Gainesville City Council’s work session during the initial presentation of the city’s FY 2022 budget by City Manager Bryan Lackey.

Gainesville is receiving nearly $12-million in federal assistance under the American Rescue Plan Act of 2021 over a two year period and city leaders want to return that money to those invested in the city through property ownership.

“What a difference a year makes.”  Those were Lackey’s opening words as he prepared to unfold the details of the $122.2-million spending plan for fiscal year 2022 which begins July 1, 2021.

A year ago Lackey’s budget presentation had to be significantly adjusted at the last minute as the impact of Coronavirus was beginning to grip Gainesville.  Anticipating a dramatic impact on the local economy, planned revenues was adjusted downward and so was planned spending. 

But, thankfully, Lackey said, the economic situation in Gainesville was not as draconian as feared.  “We scaled back to a bare-bones budget at that time…but the economy did not drop off a cliff as some feared it would.”

State law says that whenever the dollar amount of the General Fund in a governing body's proposed budget is increased, even though the attached tax millage rate stays the same or drops, it is considered a tax increase and a series of three public hearings must happened before the budget is approved.  

The FY 2022 General Fund budget is projected at $30.9-million.

“To cut to the chase of what we are doing here,” Lackey told council members as he gestured to his PowerPoint presentation, “we are going to do a full roll back so there will be no advertised tax increase.  The key thing out of that is no tax increase because of a pretty healthy rollback, a rollback-plus I call it on our General Fund.”

That is possible because of the monies received under the American Rescue Plan Act of 2021 mentioned above.  “We’re going to return 1.00-mil of tax money as a credit on the tax bill coming up, to give that back to our community.”

Lackey says the reasoning behind using the federal funds to create a tax credit for property owners is simple; many of them were ineligible to receive those income-based payments.  “There’s a lot of people getting checks…and we’re glad they are getting that.  People who need help, that’s what they need, but there’s a lot of people in our community that didn’t get it, and maybe we felt like it was our ability to give that federal money back to them.”

“If your home or property is valued at $250,000 you’ll get a $250 credit on your tax bill; if you’re fortunate enough to have a million dollar business you’ll get a thousand dollars back as a credit,” Lackey said by way of illustration.

“I’m sure I’m going to have calls and emails from some of my colleagues around the state saying, ‘What in the world are you doing up there?  Why are you giving money back?’…but we feel this is the right thing to do and we’ll do it next year as well.”

Part of the new budget includes the creation of a set millage rate to fund Public Safety, or the Police Department. 

Lackey says that move assures that Public Safety’s funding is secure. “We’re going to set a new line item, similar to what we did with the Fire Fund…not quite as much as with Fire (1.250-mils)…setting that at 0.5-mils.” 

“It sets them up for the future,” Lackey said.  “It gives them stability with their budget.”

Mayor Danny Dunagan said of the plan to secure Public Safety’s financial future, “We’re not defunding them, we’re funding them full blast.”

One public hearing on the FY 2022 budget will be held Tuesday, May 18, with a final vote scheduled for June 15, 2021.

Gainesville City Manager Bryan Lackey presents FY 2022 budget

http://accesswdun.com/article/2021/5/1005432/gainesville-plans-to-use-its-federal-covid-assistance-monies-to-lower-property-tax-bills

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