09132001 Emergency Meeting - Laserfiche WebLink

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242. Emergency Meeting September 13, 2001 Page 2 City Manager is to oversee daily operations. Mr. Mihalkanin moved for approval of the Ordinance on first reading and Mr. Mayhew seconded the motion. Mr. Gilley stated if the Council accepts the recommended reductions, it will reduce some services and programs. Mr. Gilley stated the goal remains to serve the community efficiently and at a high level. Ms. Hughson stated if the Tourist Product Development is not funded, reducing the budget by $50,000.00, and the Tanger Advertising Program is reduced $50,000.00 (this would leave $25,000.00 in the budget from Hotel- Motel funds for that program), this would fund $100,000.00 of the suggested cuts in Mr. Gilley's memorandum dated September 14, 2001. Mr. Cox stated the City had a systematic process, and he thinks it is too late in the process to make changes. He stated the sky will not fall in if the reductions are made, but it may well impact the future by having to pay more in the future. He stated he had been very proud of the steps taken to move things forward, and thinks the Council listened to the taxpayers when direction was given to reduce the tax rate from 5 cents to 2-1/2 cents. Mr. Mayhew also expressed he had been satisfied with the process, and Staff had cut the tax rate from 5 cents to 2-1/2 cents when directed to do so. He stated there will be ramifications from cutting back now. Mr. Mayhew stated we recently received a good bond rating report, and it is important for the Council to be consistent. Ms. Tatum asked Mr. Gilley if this might affect the bond rating. Mr. Gilley stated it would be hard to say, because the bond rating companies look at a variety of things. They look to see if we are fiscally sound, maintain good fund balances, and if projects are completed the City says we are going to do. Mr. Gilley stated in bond ratings, the City has committed to support debt. Ms. Tatum asked if this would change our bond rating, and Mr. Gilley stated it could hurt the City in future bond ratings. Mr. Gilley stated if it is the Council's judgment that this is a fiscally prudent thing to do, the Council will have to sell that. Mr. Montoya asked Mr. Gilley if there was an industry standard what a fund balance should be. Mr. Gilley stated with reliance on sales tax, there is a need to maintain good fund balances, because sales tax income is volatile. Mr. Gilley stated he thinks we are in the range of fund balance that would be needed. Mr. Mihalkanin stated that he can understand why after the terrorist attack two days ago people would think a discussion on our proposed tax increase is as unimportant as dust on butterfly wings; and yet, the Council still has a public duty to perform. The Council gave direction in the policy statement, but he was elected after that direction was given. Mr. Mihalkanin stated he respects the work of the Council but has to follow his own conscience as to what is best for the community. Mr. Mihalkanin stated he is concerned with the sizeable increases in property evaluations. He stated the City should not raise taxes at a time of an economic downturn. He stated there should be some give in the budget. He stated there is about a $7 million increase in the budget this year, and Staff should be able to find $400,000.00 to reduce. Ms. Hughson asked Council if the Council could compromise with a 1 cent or ~ cent tax rate increase, and there was consensus to consider this. Mr. Montoya stated he wanted to explore $50,000.00 from fund balance and wants the Police budget to stay intact. Mr. Montoya asked if this would hurt our bond rating, and