The City of Helena continues to consider a 1% sales tax increase that could generate approximately $2 million for the city’s annual budget. The topic was discussed at a recent meeting of the Helena City Council.

According to WBRC, City Councilman Andy Healy agreed that nobody wants to raise taxes. He told the news outlet, “I didn’t get appointed in January to raise taxes, but we have to do it. Big picture is we have to raise them.”

Councilman Chris Willis introduced the proposal at an earlier work session. He and other city leaders have framed the increase as a way to help the city manage its rapid growth and fund essential services.

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Helena, one of the fastest-growing municipalities in Shelby County, currently operates with fewer resources than many neighboring communities, according to the council. Members assert that the proposed increase from 9% to 10% would increase the city’s budget to a level comparable to other communities surrounding Helena.

The proposal follows an audit that revealed Helena exceeded its budget by over $11 million in the last fiscal year. According to reports, the city concluded the year with a significant budget deficit and overspending in several departments, particularly in relation to large-scale capital projects, including a new city hall and sports complex.

WBRC said that if the proposal passes, 25% of the funds from the new sales tax would be earmarked for bond payments on city projects, such as the city hall and sports complex. Additional funds would be allocated to the capital project fund.

The bond payments for the city have sparked considerable debate among residents, who were originally told that these projects would be completed without incurring extra costs for them. In response to these worries, some council members have allocated bond funds specifically for this purpose.

“I just think what happened was we looked at the bonds, maybe, and this is my point of view, is that we kind of jumped before we actually looked to see what was ahead of us,” Healy told WBRC.

He added that the additional $500,000 generated annually from the proposed tax would go directly toward the bond payments, which should reassure residents about the state of the city’s finances.

The City Council is expected to hold a public hearing about the tax increase and vote on the issue during its next meeting.

Sherri Blevins is a staff writer for Yellowhammer News. You may contact her at [email protected].