The City-County Council killed two tax proposals late Monday, with one vote delivering a defeat to Mayor Greg Ballard’s deficit-cutting strategy.
The council voted 18-11 against a proposal to phase out the homestead property tax credit over two years. Three Republicans joined the majority Democrats in voting it down.
A Fountain Square economic improvement tax proposal was killed using a different maneuver after opposition had increased among property owners in the commercial district.
The homestead credit vote came after Ballard had called for its elimination for a year. A study commission — created out of a bipartisan budget deal between council leaders and the Republican mayor — sided with phasing it out over two years, but it fell a vote short of issuing a formal recommendation.
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If the proposal had passed, by 2015 most homeowners would have seen their property taxes increase annually by $30 or less. City/county coffers would have received an extra $4.2 million for next year’s still-unbalanced city-county budget, and $8.4 million in 2015. The city’s deficit for 2014 has been estimated at $55.5 million.
Ballard has argued the credit is outdated because tax caps now protect homeowners.
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Earlier in the meeting, the council rebuffed a request by member Jeff Miller, who sponsored the Fountain Square proposal, to delay a vote until September. He cited declining support among Fountain Square property owners for the proposed tax and said there was a need for more discussion.
But some opponents of the proposal moved to strike it instead. The procedural move usually is reserved for proposals with technical issues or other fatal flaws, and which haven’t gone through committees, as the Fountain Square proposal had.
The council struck the proposal 22-7, prompting applause from opponents.
It would have required nonresidential property owners, including nonprofits, in parts of the commercial district to pay an assessment into a fund to cover beautification efforts, neighborhood promotion and other improvements. The council’s move allows proponents to regroup and bring a new proposal to the council if they collect enough support from property owners.
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