Pulaski County officials may soon be asking state lawmakers to help balance out the county’s tax structure. The county currently has one of the highest income tax rates in the state but relatively low property taxes. But fiscal planning consultant Jeffrey Peters told the county council and commissioners Monday that simply replacing income taxes with property taxes isn’t always possible.
“You don’t have the ability to raise property taxes toward operations,” Peters explained. “There are a few very specific opportunities where you can go back to the state and ask for more property tax money for operations. You don’t qualify for any of those at this point.” Peters said the county is allowed to reduce the income tax that’s designed specifically for property tax relief and shift that burden back to property taxes, though.
One of Peters’ biggest concerns was the fact that the special income tax that was put in place for the construction of the Justice Center is set to end next year, taking with it about $1.5 million that’s currently used for jail operations. “You could go back to the legislature and say, ‘We couldn’t afford to build our jail 20 years ago. That’s why you gave us this special income tax. It’s 20 years later. I still don’t have enough money to operate my jail.’ Ask for that to either be continued, or if you want more property tax and less income tax, ask for them to replace that revenue stream with an increase to your maximum property tax levy,” Peters said.
That’s just one of several strategies county officials plan to take, to fill a $2.7 million deficit that’s expected to develop over the coming years. They’re asking department heads to start thinking about potential budget cuts, and the county council plans to hold extra meetings with them in June and July, before the regular budget discussions in August. Officials will also take a look at the user fees charged by various departments, although Peters didn’t think that would have the biggest impact.