Nederland Council okays proposed tax increase to pay for Nederland Ave.

Published 9:51 pm Tuesday, August 15, 2017

NEDERLAND — A major road project in Mid-County may cause some taxes to go up.

The Nederland City Council approved a proposed tax rate increase at their regular meeting on Monday afternoon. The current rate is $.594000 per $100 of valuation. The proposed rate is $.609578 per $100 to finance resurfacing Nederland Avenue.

City Manager Chris Duque said the city’s tax rate is the lowest for all the cities in Mid or South-County.

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Councilman Billy Neal said he thinks if the city needs the additional revenue, now is the time to raise rates.

The $.609578 rate exceeds the lower of the effective or rollback tax rate, and state law requires that two public hearings be held by the governing body before adopting the proposed tax rate.

In addition to the proposed tax rate, the effective tax rate will be $.582058 per $100 and the rollback tax rate will be $.632355 per $100.

The effective tax rate is the total tax rate needed to raise the same amount of property tax revenue for city of Nederland from the same properties in both the 2016 tax year and the 2017 tax year.

The rollback tax rate is the highest tax rate the city may adopt before voters are entitled to petition for an election to limit the rate that may be approved to the rollback rate.

Taxes owed under any of the above rate can be calculate as follows:

property tax amount= (rate) x (taxable value of your property)/100

Public hearings on the proposed tax rate will be at 4:30 p.m. on Aug. 28 at the Nederland City Hall, 207 N. 12th St. The second hearing will be at 9 a.m. on Sept. 1 at city hall.

Duque said the city’s maintenance and operations rate — the funds that pay for fire and police services, roadwork and administration — hasn’t the changed. The interest and sinking fund that pays for the city’s outstanding debt did increase.

The council also approved an ad valorem tax abatement for Sunoco off of Twin City Highway.

Tax abatements allow industries to make repairs and expansions at a reduced tax rate.

Duque said the abatement is for $17.5 million to be used for three industrial projects: the Tank 1560 tankline, the third booster manifold and the manifold.

Phillips 66, also off of Twin City Highway, was granted a seven-year tax abatement, too.

The $100 million abatement is for five tanks and two booster pumps. The first five years of the abatement will be for 100 percent, the sixth year will be for 62.5 percent and the seventh year will be for 43.75 percent.

The Industrial Development Agreement with Phillips 66’s term was changed from seven years to 14 years as the name of the company change from Unocal to Phillips 66.

Lastly, the council voted to set a public hearing at 4:30 p.m. on Sept. 11 to consider condemning the property at 2423 Nederland Ave.

The property belongs to Waleed Khan who wants to develop a convenience store there.

The city says it has asked Khan to make progress in developing the property over the past couple of years in which he has not.

Duque said the city tries to work with businesses, but they have reached a point where that will no longer work in this case.