The City of Ketchikan’s 2019 budget was built on the premise of a .8 mill property tax increase. But, the Ketchikan City Council rejected that tax hike in a split vote Thursday.
In December, the council approved the mill rate increase through its normal budget process with only one dissenting vote.
But, the council needed to vote again on the tax hike to make it official, and that was the action scheduled for Thursday.
Council Member Lew Williams III wasn’t on the council in December. He was appointed to a vacant seat this spring. He said that tax increase – from 6.6 to 7.4 mills – was intended to help pay for expected pay raises resulting from a city-wide compensation plan update.
But, he said, the city has options.
“I brought up, instead of raising it, stick to 6.6 due to some reserves and having 19-20 positions not filled, which is saving us a lot of money, and instead of raising in anticipation, see where we are financially through this year,” he said. “We have plenty of reserves if we need to take some money from it to cover it.”
City management has estimated a cost of just under $2 million if the city implements all the recommendations in the compensation plan update.
The council took no action Thursday on that plan. A meeting with consultants Ralph Andersen and Associates is set for later this month. An exact day has not yet been scheduled.
Williams said he would be open to a mill rate increase next year, if expenses warrant it. While other council members voted in favor of the tax hike, Williams stressed that all elected city council members are careful about raising costs to citizens.
“It’s not that they go around and raise things dramatically all the time,” he said. “The council has been very conservative. But, the idea passed by 4-3.”
Williams was joined in voting to maintain the current mill rate by Council Members Sam Bergeron, Dick Coose and Mark Flora.
Also Thursday, the council adopted an ordinance to surplus the old Main Street fire hall and sell it in an outcry auction; and another ordinance to prohibit on-site marijuana consumption businesses within city limits. The second ordinance will not take effect unless city voters ratify it in the October local election.