City Manager Tom Fox presented the budget dilemma to council members at a Tuesday evening work session after he spoke with County Tax Commissioner Barbara Dingler and County Chief Tax Assessor Tommy Knight earlier in the day.

Fox explained to the council that while Porterdale's property assessment actually increased from 2008's value, development has slowed to a trickle and sales tax funds are expected to be down by approximately $37,000. He added that the deficit in the FY2009 budget was ameliorated by the sale of sewer capacity to the Newton County Water and Sewage Authority, which is not a measure available to Porterdale again this year.

"In order to maintain just what we've got now," Fox explained to the council, "it will require a millage rate increase."

To match revenue with an expected $1.1 million in expenditures in Porterdale's general fund, Fox suggested that the millage rate would need to be increased from 8.764 to 14.26. He said an owner of a $100,000 home pays approximately $350 in property taxes to the city each year. With the increase, the same hypothetical resident would see their city property taxes increase to approximately $500 - increasing the entire property tax bill to more than $2,000.

Some council members vehemently opposed raising the millage rate.

"Everybody is struggling and I know the city is struggling too, but we can't just keep saying ‘give us more,'" said Council Member Linda Finger, adding that the city recently increased their water, sewer and solid waste rates.

She said the city should review the budget and see where other cost cutting measures could be saved. Fox said the city is already running on a bare bones budget and labor costs were really the only place the city could save funds - he said approximately three fulltime employees would need to be let go to close the gap in the budget.

"We can't take any more out of public works or water and sewer," Fox said. "The only way to do it, and I hate to even say it, is to cut public safety."

"It's a simple equation - you either raise taxes or cut services."

All council members present (Mike Harper was not in attendance) expressed that cutting public safety personnel was not an option they were willing to approve.

Fox suggested having city employees take unpaid holidays similar to what the county has done in an attempt to balance its budget - although he said it would only save the city about $20,000. Councilman Robert Foxworth wondered if they could raise the millage rate some as well as mandate furloughs or smaller salary cuts for employees in order to preserve all current positions.

"We can hit a handful of employees or we can hit 2,000 residents," Finger said.

While around 70 percent of Porterdale's residents are renters, much of the rest of the city's population are elderly individuals living on fixed incomes. Councilwoman Arline Chapman expressed concern for the minority of established residents now living on Social Security or pensions if the millage rate was increase at the level discussed at Tuesday's work session.

"What is going to happen to them?" Chapman asked. "Are they going to have to give up their homes?"

Councilman Lowell Chambers said if the council decided to go with further budget cuts, he felt that layoffs would be a more feasible option than unpaid holidays or 10 percent salary cuts.

"At that point, you're just starving them to death slowly," Chambers said.

Fox said if the council chose to increase the millage rate, it would need to be approved by the Sept. 14 meeting. The council decided to hold a special called meeting to discuss the city deficit at 6:30 p.m. Aug. 20. at city hall. The regularly scheduled planning and zoning meeting will be relocated.

"You just can't operate without money," Fox said, "and the only mechanism that the city has is taxes and fees."

The last time Porterdale raised its millage rate was in 2004; the rate was increased 2 mills.