“We're going to have to discuss it,” he said. “I also want input from the people.”

That's why during today's discussion Smith told City Manager Joseph Scherer and his fellow council members, “If we're going to see a tax increase, bring it before the budget hearing. Let them know in advance. I just don't want any last-minute surprises.”

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Smith's comments came as Scherer and Finance Director MeLinda Hite discussed bleak revenue projections from the state.

Matters to consider as the budget process gets under way, Scherer said, include knowing precisely what the revenue situation is going to look like; appeals in the countywide property revaluation; cost reductions; service reductions; the overall state of the economy; the theater debt as well as health and wellness factors.

Mayor Emery Doughtie continues to stand by a sales tax increase, something that must be approved by legislators before a referendum can be held. “It would be best to start a dialogue to get a sales tax as a way to create a sizable amount of revenue without adding a property tax burden. A sales tax can reposition money from people traveling through the area.”

A past effort to do this was nixed by state lawmakers, Doughtie said, because they felt the county should be involved. “They weren't interested in a municipality taking it on.”

A 1 cent sales tax increase would create close to $1 million, the mayor said.

Hite explained while the city is expected to lose $50,000 in property tax revenue from the county revaluation, that loss could be more as appeals are ongoing. “Halifax County is still going through appeals. They will continue through June 30.”

These appeals include not only business but residential property taxes. “We could see even more decreases in the levy.”

The city is expected to lose an estimated $350,000 from the repeal of the local business privilege license tax and is expected to see a decrease of around $4,500 in Powell Bill funds.

The biggest revenue loss potential, Hite said, could come from Senate Bill 369, a bill that would redistribute sales tax revenue. “If it's not revised, it would take three years to be implemented.”

If implemented as is, the city would lose more than $800,000 in sales tax revenues over three years. The city typically collects $2 million. “That's a hit,” Hite said.

“Everyone across the state is screaming about it,” Scherer said. “It was originally intended to refund money to rural counties.”

Scherer said he is still waiting to hear from the league for guidance.