Prospect adopts interim tax rate increase, advances FY2025–26 budget after split vote

The Prospect City Council adopted an ad interim tax rate of 18.3¢ per $100 of assessed value on a 4–3 vote Tuesday and gave first reading approval to the city’s FY2025–26 budget.

Mayor Doug Barnsley, presenting the budget, said the city remains financially healthy and explained the proposed rate change and spending priorities. "The city of Prospect remains on a sound financial footing," Barnsley said, noting a $150,000 surplus last fiscal year and "just under $4,000,000 in cash on hand" as of June 1.

Barnsley told council members the proposed rate — 18.3¢ per $100, up from the current 17.4¢ — would generate additional revenue used for employee pay adjustments, a local match for state-funded highway work, and capital projects. He calculated that a homeowner of a $500,000 house would pay about $45 more next year while a $1,000,000 home would pay about $90 more.

The council debated the increase at length. Council member Don Gibson criticized the size of recent tax increases, saying, "I get a 22% increase in taxes. I don't think inflation's gone up that much in the past 3 years." Council member Sandra Leonard expressed similar concern. The council proceeded to a roll call on the second reading of Ordinance 653 (adopting the ad interim tax rate); the vote was divided and Mayor Barnsley cast the deciding vote in favor, resulting in a 4–3 adoption.

Council then took up the ordinance establishing the budget for the general fund, municipal road aid and capital project funds (Ordinance 654). After a first reading and a motion to approve the circulated version, the council approved the budget on first reading by a vote of 5–1. The materials will go to a special meeting for a second reading and possible final adoption.

Officials described how the additional tax revenue is expected to be spent. Barnsley said the increase would help fund a 3% cost-of-living adjustment (COLA) for various city employees, additional pay increases for some personnel, and a 20% local match required for planned improvements to U.S. 42 (the state will pay 80% of that project). The budget also includes a proposed boardwalk extending from the rear of City Hall to Putney Pond and funding to replace six city computer workstations (about $12,000).

Police pay changes were discussed as part of the budget: the proposal would raise part-time officers’ hourly pay by roughly 10% so their rate equals full-time officers’ hourly pay, and would increase the police chief’s pay by about 9% and the assistant chief’s by about 11% (Barnsley said even after the increases those salaries would remain lower than comparable nearby departments).

Barnsley said the city projects roughly $80,000 in additional property-tax receipts from new construction in the Breakers and Hunting Green neighborhoods coupled with the rate change. He also noted that insurance-tax receipts have risen sharply in recent years and factored into overall tax revenue growth.

The council scheduled a special meeting to consider second reading and final action on the budget ordinance. No additional ordinances were adopted during the meeting.