Red Springs residents will have to pay more in property taxes and for garbage pickup under a budget that was adopted last week for the next fiscal year.

The Board of Commissioner approved a $9.7 million budget that calls for a 2-cent increase on the property tax rate, from 62 to 64 cents per $100 of property. That means the owner of a $100,000 home will pay $640 in property taxes to the town, a $20 increase over the $620 that person has been paying.

“If you divide that by the number of households and businesses in town, it’s about $18 a year per household,” Mayor John McNeill said, adding that the increase will generate about $30,000 in revenue for the town.

The budget went into effect Sunday, which was the beginning of the fiscal year.

McNeill said the tax increase is the result of a stagnant economy.

“Our total property evaluation is no greater now than it was 10 years ago, and it’s a matter of no growth, declines in some areas, loss of population and so forth,” he said. “We also have an extremely high population of senior citizens, and with the senior citizen exemption, it’s a tremendous impact on the budget.”

Also included in next year’s budget is an increase of $1 a month per household in the sanitation fee. The new residential sanitation fee will be $20.25 per month. McNeill said that will generate about $19,000 per year.

There will be no pay raises for the town’s 56 full-time employees. The last time the employees got a cost-of-living increase was 2007, McNeill said. Last year, all town employees received a $500 bonus.

“I think the board desperately wants to do something,” McNeill said. “The consensus I have from talking with the commissioners about it is that, mid-year, we want to take a look at where we are with our budget. If we feel like we’re keeping the expenses in line and if our revenues are there or maybe up, we hopefully can be in a position to do something for them.”

While there are no capital projects budgeted, McNeill said the town has two pending projects that are awaiting approval on funding.

The first is a water and sewer project that will cost about $1 million. The second is a sewer plant project estimated at about $750,000. Both projects are expected to be paid by a grant and a-interest loan, McNeill said.

“It’s dependent on the Local Government Commission saying that our finances are such that we can afford to repay the loan,” he said.