Frustrated New Haven residents convened at City Hall Tuesday night in the first of a series of public meetings to address the city’s budget plans, which include a controversial tax hike.

Citizens voiced their opinions to the city’s Finance Committee on a proposed 3.5 mill property tax increase from the current rate of 39.53 mill paid by New Haven residents, which would raise $15.7 million in revenue annually. Discussion grew particularly heated when residents called for an increase in Yale’s financial contribution to the city, one of many suggestions offered at the hearing for lessening its debt.

Wendy Hamilton, a New Haven resident and nurse at Yale-New Haven hospital, said she thinks while Yale does contribute positively to the city in some aspects, she believes Yale can do more with the interest from its endowment “to help the community in a humane way,” rather than passing the burden on to the lower-income residents of New Haven.

“The problem with property tax is that the poor and the rich get taxed the same amount for their property,” Hamilton said. “With income tax, rich people get taxed more. These are just poor, working class people. It is time for the corporation that owns this city to start kicking in.”

Under state law, Yale, like other non-profit institutions, is exempt from property taxes on its educational property. Mark Pietrosimone, controller of finances for the city, said he believes the problem lies with the state government’s inadequate reimbursement of property taxes not paid by Yale.

“Because of Yale’s tax-exempt status, the state government agrees to subsidize what Yale does not pay in property tax,” he said. “The problem is that the city does not get the actual tax payment. We get 60 percent to 65 percent of each dollar.”

Pietrosimone said that if the state paid the full amount, the city of New Haven would realize $10 million to $15 million in profit and eliminate the need for the proposed tax increase. Yale recently negotiated an increase in its annual contributions to the city, although the terms of the agreement have not yet been released. Yale gave just over $2 million in voluntary contributions last year.

At the meeting, the Board of Education submitted their budget for review by the Finance Committee. The budget came under scrutiny by residents who suggested that the Finance Committee reevaluate department expenditures before raising taxes.

Yale political science professor David Cameron, who called the city’s debt an indication of the “fiscal irresponsibility” of Mayor John DeStefano Jr.’s administration, gave testimony citing the “bloated Board of Education” expenditures of $158 million as a major contributor to the debt. Cameron also suggested examining the recent increase in employee benefits and pensions as a possible place for cutting costs.

“Why, for example, are pensions projected to increase by 18 percent, $3.9 million?” Cameron said. “Why, given the continued reduction in employees, are employee medical benefits projects to increase by $3.2 million, or 9 percent?”

Nancy Ahern, a Westville Republican who served on the Board of Aldermen until last year, said the solution might not be to raise more money, but instead take a detailed look at “cutting bonding” by stopping the construction of new schools.

“It’s time to stop building schools,” she said. “I think we’ve gone far enough for what we can afford.”

The Finance Committee will convene several times in the near future to review other departments’ budgets and issue a recommendation to the Board of Aldermen on whether or not to accept the proposed budget and accompanying tax increase.