To close a budget gap in Newark, a tax hike looks to be on the horizon.
As the city tries to close a roughly $2.3 million budget shortfall presented in August, officials are proposing increases in taxes and water fees.
At Monday’s preliminary budget presentation to Newark City Council, City Manager Tom Coleman said the budget shortfall is down to a projected $850,000 after some cuts were made.
Those cuts included cancellation of July 4th fireworks as well as deferring some projects.
Coleman says raising taxes along with providing a homestead tax exemption is what he’s recommending as of now.
"We recommend moving forward with the 10% Homestead exemption, with a 50% cap. Along with the necessary tax increase to close the remaining budget gap. In the presentation before you, this is roughly 22%, but that doesn't reflect any additional changes," said Coleman.
That exemption would be for properties that are occupied by owners with no rental permits.
Coleman also suggests a hike in water fees.
"We have included an 8% water rate increase with this adjustment. We'll generate $680,000 in additional surplus that will serve two purposes. The first is to provide capital reserves, and the second is to help phase in the larger increase we expect with the PFAS forever chemical project once it's complete and we have to start paying debt service," said Coleman.
Other changes could be more revenue than expected coming in or even more cuts or an increase in other fees.
There was another property tax increase proposal during the presentation that called for a 15% hike across the board. A final budget presentation and recommendation is expected next month.
