CORINTH — Corinth city officials approved a motion Thursday night giving them the option to raise the property tax rate if Hickory Creek and Lake Dallas officials decide to backtrack on their agreement to help pay for fire department services.
The cities verbally agreed last month to continue their partnership with Corinth for fire service, but a new contract is still in the works.
If Lake Dallas and Hickory Creek decide not to renew their agreement with Corinth, that would force Corinth to come up with about $1.4 million to ensure fire services aren’t interrupted.
Officials, however, don’t believe the two communities will pull out from the agreement at this point, but said they want to be prepared.
Corinth Mayor Paul Ruggiere said the City Council wants to retain the option of a tax rate increase of about 4.6 cents per $100 valuation to help pay for fire services just in case the deal falls through.
“I just want to make it clear that just because we approve the proposal, it doesn’t mean taxes are being raised,” he said. “We just want this option and to make sure we have it, we have to propose it and make the public aware of it.”
The current rate is 59.135 cents per $100 and the council approved a proposed rate of 63.790 cents.
The city would raise the rate enough to bring in an extra $600,000 to help make up the difference. Corinth would use a combination of reserve funds and a restructured debt payment to pay the other half of the costs.
In a previous interview, Ruggiere said that a tax rate increase would result in about a $50 increase a year for property owners.
He said if Lake Dallas and Hickory Creek ultimately don’t renew, that could spell trouble for Corinth, which would probably have to make cuts to city service if a tax rate increase isn’t used.
Interim City Manager Jim Berzina said if the city decides not to increase the tax rate and if Corinth is forced to shoulder the costs of the fire department, then cuts to city services could be painful.
“We don’t have any reasons why it won’t be renewed, but it pays to be safe rather than sorry,” he said.
For about two months, the three communities went back and forth on negotiations regarding the fire department’s budget.
Corinth owns and operates the fire department, and Lake Dallas, Hickory Creek and Shady Shores have contracted fire services from Corinth for the last five years.
Last week during their respective council meetings, Lake Dallas and Hickory Creek officials voted to stick with Corinth’s fire services after Corinth verbally agreed to their demands to cut $600,000 from the proposed contract’s budget.
However, the contracts aren’t written, which leaves the door open for the two communities to not sign if for some reason they decide they aren’t satisfied with the written agreement.
“We’re working on finalizing the contracts and we’ll be getting them to the other cities very soon,” Berzina said.
JOHN D. HARDEN can be reached at 940-566-6882. His e-mail address is jharden@dentonrc.com .
