Newark City Council will consider utility rate and property tax increases to make its 2026 budget work.
City officials used a series of cuts – including removing or delaying $5 million worth of capital projects – to trim a nearly $7 million dollar shortfall projected in August.
But City Manager Tom Coleman said more needs to be done, recommending increases to water, sewer and electric rates, as well as property taxes. All together, the proposed increases would cost the average resident another $518 next year.
“Without the revenue that would come from these changes, without this revenue, we would basically be limited to looking at reductions in force, ideally through attrition in the general fund,” Coleman said.
Councilmember John Suchanec initially met the proposal for rate hikes with suspicion.
“You brought it back to a reasonable discussion level for us, and I appreciate that,” Suchanec said. “I think you're going to have a hard time getting this Council to approve tax increases, though. That's just my assessment, and I don't know what we do about that if we don't increase taxes. I hear we're kicking a can down, down the street, just avoiding the inevitable.”
Later in the meeting, Councilmembers came around to the idea.
Several Councilmembers voiced support for water, sewage and electric rate increases. Councilmember Corinth Ford didn’t see any alternative solutions, but said looking forward, Newark needs to get creative.
“I think priority one this year has got to be new revenue streams,” Ford said. “It distresses me. I know it distresses everyone to see us digging into our reserves to pay for operating taxes. That's akin to me digging into my 401K to pay my daily expenses. Not a good practice.”
The city officials proposed an event fee or tax to add to the city’s toolbelt, but Suchanec and other Councilmembers said they’re not sure who or what it would apply to or how to enforce it.
Coleman said if rate hikes are approved, he would then look for direction on lifting the hiring freeze.
“I think you’ve done a really good job of justifying the water and the sewer rate increases,” Suchanec said. “And the way you presented them in terms of impact of residents, I think it's something that I can discuss with the residents and get them to buy in as being a reasonable increase property tax.”
Utilities and wages make up two-thirds of the city’s expenses, and the city has to continue working on a project to lower the amount of forever chemicals in drinking water to stay in compliance with federal law.
The first budget hearing is set for Nov. 3. Council could vote on the budget then.
