ROWAN COUNTY, KY (LEX News) — Many people hear the words "property tax" and think that their bill is going up.
But that was not the case Monday during a special called meeting of the Morehead City Council.
Council members approved the first reading of a proposal that would lower the city's property tax rate by about 2%, according to City Council Member Edna Schack.
"This was first reading today and we voted to take the compensating rate ... about a 2% drop from last year in terms of the rate," Schack said.
While a lower tax rate may sound appealing to property owners, city leaders say the discussion is more complicated than simply cutting taxes.
Schack said property taxes are one of the city's most reliable sources of revenue and play an important role in funding city operations.
"It's our most consistent line of revenue," Schack said.
City leaders say a lower tax rate could mean a smaller tax bill for property owners. However, they also say reducing property tax revenue too much could create financial challenges for the city in the future.
Property tax revenue helps support services such as public safety, road repairs and other city operations. Schack say a significant reduction in revenue could make it more difficult to fund services and improvements in the years ahead.
"When you start dropping revenues, it has impacts for years to come and it's very difficult to make it up," Schack said.
Monday's vote was only the first reading of the proposed ordinance. No final decision has been made.
Council members are expected to take up the proposal again Friday.
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