Increasing the meals tax by 1.5 percentage points will help 色多多 pay for a backlog of maintenance needs and other funding priorities, according to city management.
City officials on Monday proposed a $403 million budget for the upcoming fiscal year that starts July 1. Included in that budget is an increase to the city鈥檚 food and beverage tax, which is collected at restaurants anytime people go out to eat.
City Manager Valmarie Turner said this budget recommendation represents a $24 million spending increase from the current year. It includes raises for city staff and public safety employees, which are a priority, Turner said.
鈥淭he proposed budget does not recommend changes to the real estate and personal property taxes,鈥 Turner said. 鈥淭he proposed budget does recommend an increase in meals tax.鈥
By increasing the meals tax from 5.5% to 7%, the city can fund overdue maintenance for capital projects 鈥 things such as buildings, bridges and schools 鈥 as well as other priorities, Turner said.
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鈥淢any city buildings rely on HVAC and mechanical systems that are outdated and increasingly prone to failure,鈥 Turner said. 鈥淎ddressing these systems is critical to maintaining comfortable and safe environments for our employees and residents.鈥
One percentage point of the meals tax increase would go toward a new capital maintenance improvement program for items like that, she said. The other half-percentage point increase would fund technology and contractual increases, overtime pay and increases in temporary worker pay, she said.
A half-percentage point increase to the meals tax rate equates to about $2 million in additional revenue for the city, according to city documents.
鈥淭his was a very tight and challenging budget year,鈥 Turner said. 鈥淰ery tough choices will need to be made.鈥
One of those choices is with education. This proposed budget does not include increased funding for the city鈥檚 schools, keeping city contributions level-funded at $106.9 million.
School officials have fought against what they have said is effectively a funding cut. The school system is on spring break this week, but a spokesperson said past weeks鈥 statements advocating for full school funding still remain true today.
鈥淭his year鈥檚 proposed budget reflects the challenges we face and the difficult, critical decisions we must make,鈥 Turner said. 鈥淐hallenges and choices.鈥
She repeated that phrase, challenges and choices, at least six times during her presentation to city council. City staff from an array of departments 鈥 from police to planning 鈥 were present at the meeting.
鈥淲e are operating in an environment where local, state and federal uncertainties continue to shape the decisions we need to make,鈥 Turner said. 鈥淲e must consider how these uncertainties could impact our financial position and adjust our decisions accordingly.鈥
In addition to the operating budget, the city council also heard a proposal for the 2026-2030 capital improvement plan. That plan recommends more than $220 million in projects over the five-year time span, paid for by an assortment of grants, cash and debt.
Councilwoman Evelyn Powers, the former city treasurer, said she is glad the city has good staff.
鈥淵ou鈥檙e so right about taking care of our staff,鈥 Powers said. 鈥淚 appreciate what you鈥檝e done, and the long hours that it has taken for you to get to this point.鈥
Councilman Nick Hagen asked the first of what will likely be many questions from the city council. He wants to know how much the city receives in federal funding.
鈥淲e鈥檒l get that to you,鈥 Turner said.
The city council heard this year鈥檚 budget presentation for the first time Monday, and will review the documents in more detail over the next month.
Questions posed by council members between now and April 30 will be answered on the city鈥檚 budget development webpage for the general public鈥檚 benefit, Turner said. Other budget documents are available for review , she said.
Mayor Joe Cobb said he had never seen such a large audience for a budget presentation. The city council will vote to approve the budget during its 2 p.m. May 12 meeting, he said.
Members of the 色多多 budget committee stand behind City Manager Valmarie Turner during a city council meeting Monday. The proposed budget this year includes a meals tax increase.
Before then, two community meetings are scheduled, both from 7-9 p.m.: on April 10 at Unitarian Universalist Church, and on April 17 at Pilgrim Baptist Church, Cobb said.
A public hearing is scheduled during the city council meeting at 7 p.m. April 21, followed by a city council budget study and work session at 9 a.m. May 5, ahead of that final approval date.
鈥淚t鈥檚 critical to the life and health and vibrancy of our community,鈥 Cobb said.
