By David Purtell

david.purtell@salisburypost.com

Salisbury CIty Council Tuesday approved a city budget that includes a small increase in property taxes.

The budget for the 2015-2016 fiscal year, which starts July 1, raises the property tax rate by 0.31 cents — the new tax rate for the city will be 66 cents per $100 of valuation.

City staff’s initial budget proposed increasing the tax rate by 1.49 cents, with 1.18 cents of that meant to cover the loss of $320,000 in revenue due to the expiration of the state’s business privilege license tax. But council members decided to dip into city savings to avoid raising taxes any more than is necessary to make the budget revenue neutral.

A minimal tax increase this year could result in a larger than expected tax increase in the future. At some point, City Council will have to find a way to make up for the lost privilege license revenue without using the city’s savings. Councilman Brian Miller said an increase in revenue from sales tax in the coming years could make up the difference.

During the meeting, City Manager Lane Bailey said the additional tax rate for the city’s downtown area, called the Municipal Service District, needs to be increased from 17.5 cents to 17.6 cents. City staff found the increase was necessary to make the budget revenue neutral, Bailey said. The tax funds Downtown Salisbury Inc., the non-profit that promotes downtown Salisbury.

Council voted 4-0 to approve the budget. Councilman Pete Kennedy was not at the meeting, but Mayor Paul Woodson said Kennedy had given him his approval of the budget.

The budget also includes a 75 cent increase in the monthly residential stormwater fee, bringing it to $5. It is the first increase in the fee since it started in 2012.

Rates for Fibrant’s TV packages will increase in the new budget. The increases range from 6 percent to 18 percent depending on the channel package. City officials say the increase is necessary to offset rising costs the city pays to its program providers.

The new budget includes the hiring of a Parks and Recreation director, which the city has been without for more than two years. Bailey sees parks and recreation as being crucial to quality of life in the city.

The city’s general fund budget will total slightly more than $40 million in the coming year, up from $36.2 million this year. The water and sewer fund budget for next year is $22.7 million and about $70,ooo more than the current year.

More than $1.8 million will be taken from savings, called the fund balance: $150,ooo for the city’s neglected housing initiative, $500,000 for funds already approved to go toward the school system’s new central office building, $320,000 for adding bike lanes and sidewalks along Newsome Road, $550,000 for implementing parts of the city’s Complete Streets plan for Innes and Long streets and $200,000 for incentives to encourage development in the downtown. Another $78,000 will be used for police equipment.

In other business Tuesday, council:

• Held a moment of silence for Karen Young, who died June 3. She was the first woman to serve on Salisbury City Council. Mayor Paul Woodson called Young a “pioneer.” Young served on council in the late 1960s and early 1970s.

• Approved a request to rezone property along Faith Road to allow for a hair salon.

Tasha Hall and Crystal Vanhoy, who work at Touch of Class on South Main Street, plan to make the house at the corner of Faith Road and Ann Street — 230 Ann Street is the address — into a salon and open their own business there. The property is currently zoned urban residential. Vanhoy and Hall plan to buy the property.

• Approved removing the restriction on parking on the north side of Ridge Avenue between Crosby and New streets across from the Crosby Street Apartments. The move is meant to create more parking spaces, 11 in all, in the area. Specifically, council wants to alleviate concerns the owner of Mean Mug Coffee, at the corner of Fulton Street and Ridge Avenue, had after the city restricted parking on Ridge Avenue adjacent to the Coffee Shop in order to allow city buses to more easily make the turn from Fulton Street to Ridge Avenue.

• Adopted a resolution declaring the city’s intent to permanently close Hall Street and make it a private drive. Hall Street runs through what will be the new development at the old Civic Park Apartments. The developer wants to make Hall Street a private drive. A public hearing on the issue will be held July 21.

Contact Reporter David Purtell at 704-797-4264.