A decision on whether to raise commercial rates by 15% for businesses in Galway city has been deferred to allow for further discussions over the next week.
At this afternoon's budget meeting of the local authority, Chief Executive Leonard Cleary told elected representatives that the hike was needed to cover a range of planned initiatives.
These included investment in sports and recreational amenities; measures to deal with vacant and derelict sites; additional steps to enhance the city's tourism offering and further spending on environmental measures to reduce carbon emissions.
Mr Cleary said the proposed increase in the Council's annual budget from €121 to €147 million was "a significant step change" which would require more income.
He said there had been no rates increase in nine years and without the additional €6.4 million that would result from the proposal, the city would be effectively "running on fumes".
The Chief Executive described the move as "a reasonable request" but acknowledged it would impact on rate payers. As a result some discount schemes were planned to support the transition.
Councillors recently approved a 15% increase in the Local Property Tax (LPT) payable by homeowners across the city.
Today, many expressed serious reservations about the plan to hike commercial rates, during sometimes heated exchanges with officials.
Mayor Peter Keane of Fianna Fáil said it "beggared belief" that businesses being "clobbered" by wage inflation, increased energy and insurance costs would be asked to pay an additional 15% in rates, some of which would go towards paying consultants €2 million to prepare planning applications for sports facilities in the city.
Independent Councillor Declan McDonnell said there was little clarity about how businesses could expect to benefit from the additional charges.
Labour's Niall McNeilis asked what the consequences would be of members not approving the increase. He asked if the hike could be imposed by central Government, regardless of the views of elected representatives.
Fine Gael's Clodagh Higgins said businesses in the city were badly struggling at present and asked what consideration had been given to the impact the proposed increase would have on them. She said she could not back the plan as it amounted to giving businesses "an extra kick in the teeth".
Sinn Fein's Aisling Burke described the proposals as "very unfair overall", pointing out that many of the business owners in question would have already had to deal with increased LPT charges on their own homes.
Cllr Mike Cubbard said he did not like the "take it or leave it" approach by the Council's executive, which he said pertained to the proposals presented to elected representatives.
Fianna Fáil's Alan Cheevers said he had received several representations from business owners outlining the impact the increase would have on their operations. In some cases, he said, it would lead to closures.
Councillors were told by Director of Finance Helen Kilroy that a €2 million masterplan for sport and recreation, street cleaning measures, outdoor maintenance of public areas as well as spending on culture programmes, funding aimed at driving economic investment and community initiatives would be among the areas impacted, if the proposed levy was not passed.
The meeting heard the provision of Christmas lights, the annual St Patrick's Day parade and maintenance works at municipal burial grounds would all have to be scaled back.
Councillors were also told the Department of Local Government would dissolve the Council in two weeks, and take on the function of elected representatives if a budget was not adopted within that time frame.
But Mr Cleary said this scenario was not being envisaged. Instead, he said, time might be needed to further tease out the proposals and have more dialogue.
Councillors agreed to adjourn a decision on the proposals until next Monday to allow for further discussions.
