A move to raise taxes by about 12 percent in Surfside Beach failed Tuesday night, but Town Council members said an increase likely is forthcoming for the 2014-2015 fiscal year.
Councilwoman Mary Beth Mabry said the financial health of the town is “broken.”
“We have a tremendous cash flow problem,” she said. “We have enough money, hopefully, to pay our bills to December. That’s it. Then we’re going to start going in the hole. No more money.”
Mabry said the reserve fund is depleted and without raising taxes services will need to be cut.
Mabry, Mayor Doug Samples and Councilman Mark Johnson voted in favor of the tax increase that would’ve raised taxes by 4.96 mills or $20 per $100,000 of house value.
Councilmen Rod Smith and Randle Stevens and Councilwomen Ann Dodge and Beth Kohlmann voted against the increase.
Smith said he didn’t think keeping the taxes at 40 mills would affect services.
“No services will be impacted by not raising taxes for the new fiscal year,” he said. “The town will still have 75 valuable and dedicated employees.”
But, Smith also said he intends to raise taxes next year if he is reelected in April.
Mabry and Samples also voted ‘no’ to setting the town’s millage rate at 40 mills for 2013-2014. Both said they didn’t think it was financially responsible to keep the tax rate so low.
In 2012, Surfside Beach had the second lowest millage rate of all municipalities in Horry County. Only North Myrtle Beach had a lower rate at 38 mills.
Only one resident in Surfside Beach spoke in favor of raising taxes Tuesday night.
Mary Ellen Abrams, who spoke before the vote, said it would be in the best interest of the town.
The three other residents who spoke about the taxes suggested changes to spending.
“If you quit spending money foolishly you don’t have to raise taxes,” said John Ard.
Town Council continued to whittle away at its proposed $8.8 million budget, and gave it initial approval.
The biggest change was a move to cancel the repaving of U.S. 17 business in the town. The town has already paid $780,000 to the S.C. Department of Transportation in part of a matching grant that would resurface the roadway. The town will send a letter to S.C. DOT requesting the funds be returned. Though construction has not started, it wasn’t clear Tuesday if the DOT would be required to send the money back and terminate the project.
There will be a special meeting Thursday at 6:30 p.m. to discuss the budget. Personnel will also be discussed in executive session. Two council members alluded to cutting employee positions in town, but withheld formal motions saying personnel matters needed to be discussed privately.