Kitsap Sun: Port Orchard Council Votes Down 2010 Property Tax Increase

PORT ORCHARD — The “Fred Factor” was at work as the Port Orchard City Council on Tuesday voted to hold its 2010 property tax levy at the 2009 amount.

The ordinance came after a Nov. 10 measure to increase the property tax levy by 101 percent failed to pass the council.

Councilmen Fred Chang and Fred Olin both voted against the Nov. 10 measure to collect 101 percent of the 2009 levy amount, as allowed by law. Both said any increase, however small, would be wrong to impose on city taxpayers considering the state of the economy.

Also voting against the tax increase were Councilmen Jerry Childs and Jim Colebank, who said they promised voters during their campaigns they would not raise taxes without a vote. Voting in support were council members John Clauson, Carolyn Powers and Rob Putaansuu, all on the finance committee.

On Tuesday, the council (minus Powers, who was out of town) unanimously approved an amended ordinance that leaves the property tax levy at the 2009 level.

Because of negative inflation over the past 12 months, Port Orchard and other jurisdictions have been put in the position of having to declare “substantial need” to keep their property tax levies from shrinking in proportion to the economy.

Ordinarily, the county and cities with more than 10,000 residents can take an increase over the previous year’s tax levy of one percent or the rate of inflation, whichever is smaller. Kitsap County and the city of Bremerton have already declared substantial need and taken the one-percent increase to which they ordinarily would have been entitled.

At a Nov. 17 work study on the revised proposal, Childs and Colebank said they would support “banking,” or deferring, the one-percent increase the city is entitled to for use in a future tax year. But Olin was opposed to that, and Chang didn’t commit either way. That led Putaansuu to coin the term “Fred Factor” to describe the potential influence Chang and Olin’s votes had on the issue.

Before Tuesday’s vote, Colebank proposed removing the reference to banked capacity, saying the clause could cause the whole ordinance to fail. Chang also stated that he opposed banking the one percent.

The approved ordinance, which keeps the property tax levy at 100 percent of the 2009 amount, forfeits the right to take at some future date the one percent that would have been allowed in 2010.

The council must now trim just more than $16,000 from its total budget of just more than $24 million. The budget, with the $16,000 the city would have received from the tax increase, was balanced without layoffs or employee furloughs. Proposed cuts include the elimination of BKAT broadcasts of council meetings and reduction in parks funding among other line items, according to Mayor Lary Coppola.

The council will hold a work study session on the budget at 6 p.m. Dec. 2. A public hearing on the budget will be held at 7 p.m. Dec. 7. The 2010 budget is set for adoption at the councils Dec. 8 meeting. All meetings are at City Hall, 216 Prospect St.

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