Two Mercer County commissioners exchanged heated words Thursday over the introduction of next year's $54.7 million county budget, setting the tone for future discussions of the 2003 spending plan that Commissioner Cloyd E. "Gene" Brenneman said needs a lot of work.

The exchange started after Commissioner Olivia M. Lazor voted no on a motion to adopt the tentative budget, saying she "was not part of the decision-making process" when it came to a proposed 3-mill tax hike to support the spending plan.

Commissioner Kenneth A. Seamans broke in. "That is not true, that is not true," he said, adding that he had personally notified Mrs. Lazor on Friday.

Later, Seamans said he wanted to clarify the conversation he had with Mrs. Lazor. "When we discussed the raising of the millage, I did not know what that increase would be," Seamans said.

According to Brenneman and Seamans, who voted for the spending plan, the county needs a total of 17.5 mills of real estate tax to cover expenses. Each mill brings in $1 million to the county and costs the average taxpayer $19.25 for a total tax bill of $337, said Tressa Templeton, county fiscal administrator. The hike translates to an additional $57.75 a year, she said.

General fund spending totals $19,344,487, up from $17,957,913 this year. Much of the increase, Mrs. Lazor said, is for employee health care coverage. Health care costs rose 33 percent and 25 percent over two years, she said.

Mrs. Lazor called a 3-mill tax hike unprecedented, although commissioners raised taxes 4.25 mills this year, the largest hike in county history. A mill is $1 for every $1,000 of assessed property value; assessments are a property's 1970 market value. 2003 is the second year the county will operate under that ratio. For many years, assessments were one-third of the property's 1970 market value, so a 3-mill hike amounts to 9 mills under the former ratio.

Mrs. Lazor said she wants to examine cost-cutting options to ease the tax burden. Some of those options, she said, could include reducing the out-of-county prisoner housing expenses by adding modular units to the county jail. The county jail is chronically overcrowded, so Mercer County foots the bill to house inmates elsewhere.

Another sticking point was a cost-of-living adjustment for county employees. Mrs. Lazor favored a graded approach, while Brenneman wanted a 30-cents-per-hour increase for all employees across the board.

If the spending plan is adopted as presented, the tax levy would bring in $830,000 over projected general fund expenses, which do not take into consideration any increases, additional staff or upgrades, Mrs. Lazor said.

Commissioners are to act on a final budget Dec. 26.

You can e-mail Herald Staff Writer Amanda Smith-Teutsch at: ateutsch@sharonherald.com