The Lincoln City Council has a resolution on file to cover a $2.6 million deficit in this year’s budget, and a projected $4 million shortfall for the coming year.

A lag in sales tax collections, and the damage to the city water system during the march flooding are the primary factors, according to Mayor Leirion Gaylor Baird. Reserve funds are being used to finish up the current year.

The resolution proposes replacing that amount in savings, and paying the $4 million shortage for 2019-20, by collecting an extra $7 million in property tax revenue. To address the 2019-20 shortfall, Gaylor Baird recommends making $3 million in cuts and using a portion of a $1.8 million increase in projected property tax revenue due to revaluations and construction growth.

“It’s important for taxpayers to know that you will not see an increase in the city property tax rate because of this sales tax shortfall we face and the changes we propose today,” said Gaylor Baird. “By responsibly using our healthy cash reserve while at the same time making judicious cuts, we will balance our books heading into next year’s budget cycle.”

A public hearing and a vote on the resolution are scheduled for Monday, Aug. 26.

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