The city announced last week that it’s looking at a whopping property tax increase to help combat a deficit city leaders discovered this spring.
It would make Pascagoula the Coast city with the highest tax rate, according to the state Department of Revenue.
The City Council is proposing an increase of 14.45 mills, which would bump Pascagoula’s tax rate to 56.50 mills.
The next highest rate in Jackson County would be Moss Point at 54.21 mills. On the rest of the Coast, the next highest would be Long Beach at 48.98.
A mill is a taxing increment, and one mill brings in $232,500 for the city of Pascagoula.
The City Council gave the nod Aug. 21 to move forward with advertising the proposed millage increase to its residents.
A public hearing is scheduled for 6 p.m. Sept. 6 in the council chambers, and if the increase is approved, it will go into effect Oct. 1.
The council must approve the budget and its funding by Sept. 15.
The current city tax rate is 42.05 mills, and the maximum proposed increase would make it 56.50 mills. The City Council could approve less.
According to a city spokesperson, the council agreed to revisit tax rates each year, as debt is cleared and the city’s financial condition improves.
The proposed hike means property owners would pay $374 more a year on a $200,000 home — that’s $274 for the city on top of $100 the school system has fought for.
The city announced recently that a special audit uncovered the city has $14 million less to spend than budgeted and is essentially broke. The money in the bank is mostly bond money that needs to be spent on the projects the bonds were issued for.
It was announced that 10 full-time employees would be laid off effective Sept. 1 in the first step of measures to deal with the city’s financial crisis. Those employees were notified this month, when the city’s manager and attorney Ryan Frederic outlined proposed changes for all employees during mandatory meetings.
It appears the city has been spending beyond its means for years, living on false estimates of the money coming in.
Documents gave the appearance that everything was fine. The auditor hired told the city council, however, that nothing indicated money had disappeared or that anyone was personally profiting. However, the city has been using bond money to cover its debt since 2015. The sales tax is stable and the value of property has not deteriorated. But the city doesn’t have the money it thought it did, auditors said.
One of the city’s considerations is putting public parks up for sale.