Mayor won't rule out possible tax increase

By By Fredie Carmichael / staff writer
March 20, 2003
Mayor John Robert Smith does not rule out a possible tax increase to pay for a new $6 million loan Meridian city councilmen opted to borrow to pave and repair city streets.
Smith said Wednesday that while he doesn't foresee any problems with the new debt, he would not make any promises.
Smith's comments came a day after councilmen unanimously voted to borrow up to $6 million by issuing general obligation bonds to pave and repair about 47 miles of Meridian streets.
On Monday, Ward 1 Councilman George Thomas said councilmen would not have to raise taxes to pay off the new loan.
Thomas said he would not vote to borrow the money if it would require an increase in property taxes. He said the city has paid off old debt, allowing the council to borrow new money without raising taxes
Meridian currently has about $11 million in outstanding debt. City officials last borrowed money through general obligation bonds in 2000 $1.1 million for street-related work.
The city currently retires about $2 million a year in outstanding debt. Thomas said the proposed $6 million loan would be paid off over a 15- to 20-year period.
Even though Smith wouldn't make any guarantees, he said: "All things being equal and no additional GO debt taken on, this bond issue ought to be just about a wash of what we pay off every year."