June 05, 2020

Presque Isle taxes increase 1/2mill City manager says council’s decision ‘could have been a lot worse’

PRESQUE ISLE – Tax bills for this year will be a half mill more than 2001, as a result of action taken on Monday night by the City Council.

The new rate will be 25.22 mills or $25.22 per $1,000 of property valuation. For a home valued at $50,000, that translates into an increase of $25.

The tax rate for the past two years has been $24.72, according to City Manager Tom Stevens.

“It could have been a lot worse,” Stevens said Tuesday about the increase. “We’re under stress as a municipality, as I think municipalities in general are.”

The budget for 2002 approved last December by the council was $8,999,875.

Stevens said the tax increase was the result of increases not only in the municipal budget, but also the assessments to the city from SAD 1 and the county. On top of that, the city’s revenue-sharing payment from the state for June was half what it was last year, Stevens said.

The city in the past has gotten about $1 million a year in revenue-sharing funding from the state.

Last month the council approved budget reductions of $82,000 that resulted from the city getting less state revenue-sharing money than had been projected.

To help keep the tax increase from being greater, the City Council also voted on Monday to take $250,000 from the city’s undesignated fund balance to be used for the budget. Last year, the city used $325,000 from the fund.

“We’re trying to wean ourselves off it a little bit,” Stevens said of this year’s decision to rely less on the undesignated funds.

The city has about $2,100,000 in the fund, Stevens said, part of which is a paper surplus in the form of yet-to-be-collected property taxes.

Stevens said Ron Smith, the city’s auditor, reported to the council that overall, the city’s financial condition was sound.

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