PICKENS — Pickens City Council passed first reading of budgets for the coming year that will not include a tax increase; but there will be a slight increase in spending compared to last year.

The proposed budget for all funds for 2010-2011 is just over $5.7 million, with a general fund budget of almost $2.9 million and a water works utility fund of just over $2.8 million.

The tax rate will remain at 52 mils, according to Mayor David Owens.

“The budget does not include an increase because the CPI is negative and there has been no population growth in the past year,” he said.

However, the budget does reflect a .094 percent increase in the general fund and an 11.5 percent increase for the water works utility fund, Owens said.

“The general fund would have decreased this year, but the introduction of the stormwater utility fund caused the budget to have this slight overall increase,” he said.

Owens said the coming year’s budget is based on trends of this past year in recession where revenues are not stable, and if anything, declining due to decreased collections from property tax, hospitality tax, sales tax and continuing local government fund cuts.

“As we enter into this budget, we cannot help but be aware of the economic problems in the state and country,” he said. “The State of South Carolina has been challenged to cut upwards of $520 million from the 2010-2011 budget to handle shortfalls in anticipated revenues, and we can only brace ourselves for the trickledown impact on local governments and school districts.

“Vacant homes and commercial buildings can be seen everywhere, and like harsh recessions of the past, people have responded by changing their spending habits,” Owens said. “All of these factors make it difficult to project the year ahead.”

City council also voted last month to reduce business license fees, which will reduce revenue by 25 percent compared to the budget year currently ending.

The coming year’s budget, if it passes second and final reading, will not include cost of living increases for city employees, and Owens noted that there is a hiring freeze in place for all departments with any open positions.

“The only hiring will be to replace any employees lost during the year with approval from the administrator,” Owens said.

He said there are currently two positions frozen in the public works department and that the streets and sanitation department has a part-time employee instead of another full-time driver.

All city employees will also have 10 furlough days during the year, saving the city more than $70,000.

Among the items budgeted this year are five new air packs for the fire department, a 2010 Dodge charger and two new radars for the Police Department, expenditures for marketing, planning and grant matches for administration and hospitality, refurbishment of a garbage truck and a walking fertilizer spreader for the grounds department.

A public hearing for the budget will be held April 19, followed by a second reading vote.