City proposes tax hike

Aug. 10--Gainesville property owners could be paying more in taxes next year if a proposed rate increase is approved by city council members next month.

Council members recently voted to consider a proposed tax rate of $0.72254 per $100 valuation, an increase from the current rate of $0.70503.

The vote was unanimous. Councilman Tommy Moore was absent.

Gainesville City Manager Barry Sullivan said health insurance premiums for city employees increased by more than 16 percent and that's one of the main reasons for the proposed tax rate increase.

"On average it's 5 percent and then it jumps to 16 percent," Sullivan said. "That's a huge jump."

Sullivan said the original quote for insurance was an increase of 22 percent, but the city decided to go with a plan that would require a deductible and increase the max out of pocket cost by $1,000 to $4,000.

He also said $0.01 of the proposed increase would go to funding the city's demolition program.

The demolition program began in the 2013 fiscal year after area law enforcement asked the city how to get rid of abandoned properties since they are a haven for attracting crime.

"The city has budgeted $100,000 annually for this program over the past four years from the assigned fund," Sullivan said. "The demo program was removed from the assigned fund this year because the fund will pay $854,000 of a $3.5 million sales tax reimbursement to the state."

Kevin Lyons, a spokesman for State Comptroller Glenn Hegar's Office, said the refunds are due to tax paid in error on motor vehicles that no longer qualify under sales tax as moveable specialized equipment.

The $0.01 tax increase for the demolition program equates to $89,373 at a 95 percent collection rate, which is the estimated collection rate provided by the Cooke County Appraisal District, according to Sullivan.

Public hearings on the proposed tax rate are scheduled for 6:30 p.m. on Aug. 15 and Sept. 5 at Gainesville City Hall, 200 South Rusk St.

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