Newport council approves first reading of FY2025 budget after tax-rate, exemptions debate

The Newport City Council voted to approve the first reading of the fiscal 2025 budget ordinance, moving the proposed spending plan to the next stage of review after a public hearing and detailed questions about tax rates and staffing costs.

Council members opened the hearing on the budget and the personnel ordinance, then took public comment (none) and debated key items including the two-tier tax structure, exemptions, and the cost of proposed new positions. Finance Director Jim explained the city's approach to residential taxation and exemptions, saying the city "looks at what the average home value is" and that, for the current proposal, the average home value used in the calculation is about $1,100,000. Using an example, he said the exemption would reduce a $1,000,000 assessment to a taxable base of roughly $713,000. He stated the "residential proposed rate is at $66.98." (Finance Director Jim)

Why it matters: Councilors pressed for clarity on who would see increases and on whether discounts for seniors and disabled veterans could stack with the owner-occupant exemption. Jim said qualified residents would receive additional discounts where applicable. Councillors also questioned the scale of new positions in the budget — the administration estimates roughly $1.3 million in new staffing costs for 11 new positions including a communications assistant, resiliency assistant, grant writer, three police officers and a deputy city manager.

Councilors probed the long-term fiscal implications of a separate proposal: a $98.5 million bond the administration intends to request from the Assembly. Jim said the city estimates about $7 million in annual debt service tied to that bond and offered a back-of-envelope figure of roughly $433 per taxpayer for that debt service alone. He emphasized the bond would not be added to the fiscal 2025 proposed budget but could affect rates beginning in fiscal 2026 if approved and bonded.

The council noted the hearing is the first of multiple steps; workshops and subsequent readings will allow more detailed line-by-line review. After discussion the council closed the public hearing and approved the budget and personnel items on first reading by voice vote with no recorded opposition in the transcript. Further hearings and a final vote will follow prior to budget adoption.