Owning a car, a house or putting out trash could cost a little more in Salem next year, if proposed tax increases pass.
Monday night, Salem City Councilmembers discussed ways to produce funds to pay for some of the much-anticipated renovations to Salem High School, and came up with small tax increases.
If they pass, real estate taxes would go up 2 cents per $100 assessed value, for a total of $1.20, and personal property taxes – automobiles and trailers – would go up 15 cents for a total of $3.40 per $100 of assessed value.
It would also cost more to put out the trash – from the current $7 a month for a toter container, to $10 per month, or an additional $36 a year.
City Councilmembers decided on that figure to increase available money in the general fund so that the leaking roof on Salem High School could be replaced – and because $10 a month is just about what it costs to collect household trash. It doesn’t pay for disposing of trash, though.
The proposed increases will be aired at a public hearing, which probably would be May 28 or after.
The 90-minute discussion came at the conclusion of budget talks April 29 in the City Manager’s Conference Room. Council was trying to figure out ways to raise money locally before borrowing what is expected to be about $32 million to replace the 40-year-old Salem High School.
Raising local fees could reduce how much debt service the city will have. The money could also be used for other capital projects, Salem Interim City Manager Jay Taliaferro said, such as work needed on the Moyer Sports Complex and the Salem Civic Center.
The civic center, in particular, was one area that maintenance and air conditioning equipment replacement was deferred during tight economic times which started in 2008.
Salem City Councilmembers said they hoped their citizens will understand the need to raise money to benefit the highest priorities in the community – schools, recreation and public works.
Mayor Randy Foley said it’s time for the city to take action to keep from falling farther behind.
“We’ve just got to rip off the Band-Aid,” he commented.
If the proposed property tax increase passes, Salem Finance Director Rosie Jordan said taxes on a $200,000 home would cost an additional $40 per year.
On automobiles, a $30,000 car or truck would cost $45 more a year in personal property taxes.
Councilmembers came to a consensus on the proposed increases after Jordan distributed figures showing tax rates in nearby communities and similar-sized ones, with a 3-year-summary of revenue from cigarette tax, real estate and other areas.
One of the reasons Council was figuring out ways to raise money was that schools cannot borrow the estimated $2 million to replace the Salem High School roof, for instance, because schools in Virginia do not have taxing authority. Council members also looked at the possibility of patching the roof for $1 million, but decided against that.
“I think we need to forget the patching,” said Councilman Bill Jones. “We know what the history of flat roofs is.”
With the money from proposed tax increases, the city could cash fund the roof replacement, Taliaferro explained.
Mayor Foley said the school system is proposing giving back $1 million a year to the general fund. Taliaferro explained the school system would contribute $2 million toward furnishings and fixtures and other expenses associated in new construction.