No new taxes for Washington

Published 8:37 pm Tuesday, April 22, 2014



With the fiscal year drawing to a close, the city of Washington has been discussing their budget this week for the upcoming year, which begins July 1. City officials said it would not be raising taxes for the residences of Washington in the upcoming year.

The city recently sold the Impressions Building, which had drawn an annual rental income, so the city council needed to figure out a way to avoid taxing residents because of the missing income.

Cutting expenditures was one of the first things they did, according to Brian Alligood, Washington city manager.

The second way the city avoided a rate increase on taxes: “We put in a new transfer for sewer and water, which we currently do with the electric department,” Alligood said. “It’s essentially like taxing the infrastructure, which the state of North Carolina does that for counties and municipalities throughout the state on public infrastructure.”

The city will essentially be treating their new revenue stream like a private business, and it would be taxed at a certain rate. What that means is the city will be taxing itself, then bringing the money back into the general fund.

Washington city government has set up the sewer and water enterprise to allow the funds to stand up on their own and not use general tax dollars. The sewer and water will collect revenue and will be self-generating money for the city, according to Alligood.

An example of this would be the public service gas company, which puts a value on its services, collects a tax on it and sends it back to the county and city for distribution.

“As a private business, you pay taxes on your business personal property and real estate and it’s not unlike the same thing,” Alligood said. “We have an enterprise fund that has all this infrastructure around and it is just sitting there and we essentially tax it like a private business. It then takes that money and brings it into the general fund.”

The city has been doing the enterprise fund for a number of years with the electric fund, but has not done it with the sewer and water infrastructure.

“This year, what we have purposed to fill that gap is to say, ‘Okay, if you have been treating the electric fund that way, you should also treat the sewer and water fund that way,’” Alligood said.

The city is currently looking into treating the solid waste and cemetery as an enterprise as well, which was purposed by councilman Doug Mercer.




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