Proposed Town Budget Increases Salaries but Not Taxes

By DORIE SOUTHERN
Cape Charles Wave

April 14, 2014

Cape Charles Town Council is in the midst of hammering out a $3.2 million budget for the fiscal year that begins July 1. The  projected budget does not increase taxes on real estate or personal property, and utility bills are also projected not to increase. But even though no general tax increase is planned, the budget includes a 2 percent cost of living adjustment for all town employees.

At a Town Council budget workshop April 10, Council member Frank Wendell argued that since the town is paying $10,000 for a wage and compensation study, it should not provide any cost of living adjustment until the study results have been received.

Town Council does want to increase the lodging tax imposed on guests at hotels, B&Bs, and vacation rentals a whopping 23 percent — from the current 3 percent to 3.7 percent. That’s in addition to 5.3 percent state tax and 2 percent county tax on short-term lodging, for a new total of 11 percent. The tax increase is projected to generate an additional $19,000 revenue for the town.

The lodging tax would be spent on tourism-related events such as Fourth of July fireworks, Cape Charles Business Association projects, the Historical Society, and the new tourism website Cape Charles By the Bay. A public hearing for the proposed tax increase has been rescheduled for 6 p.m. Thursday, April 24, at St. Charles Parish Hall.

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In the new budget year the town plans to extend the multi-use trail from Central Park along Peach Street to Washington Avenue. The first phase of the trail was revitalizing Central Park, completed in 2010. At the time that the trail plans were devised, the trail head was in front of the Old School, which at that time had a flagpole in an ellipse in front of the building. After the flagpole and ellipse were removed, the town sold the property.

The second phase of the multi-use trail will cost town taxpayers $320,000 over three years, with the majority of the cost ($296,000) in the fiscal year beginning July 1, 2014. The federal government is contributing 80 percent, or $1.28 million, of the trail cost.

The budget includes capital projects costing $353,125. The majority of the funds are for the multi-use trail and $30,000 for a dump truck chassis for public works.

Current town debt is approximately $11 million, which required $600,000 in taxes to service over the past year.

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