Archive for Wednesday, July 11, 2007

City, schools proposing tax increases

Street improvements, debt payments among reasons cited by administrators

July 11, 2007

If initial proposals are accepted, city and school officials in Tonganoxie won't be holding the line on mill levies for the upcoming year -- which mean higher tax bills for property owners.

At Monday's school board meeting, Superintendent Richard Erickson asked for about a 4-mill increase for the 2007-08 budget year. Meanwhile, City Administrator Mike Yanez has submitted to the City Council a proposed 2008 city budget that would push the levy up about 2 mills from this year's budget.

¢ The owner of a home valued at $150,000 would pay about $1,543 in property taxes to support the proposed Tonganoxie city and school district budgets for 2008. That's an increase of more than $105 from taxes paid last year.

"There's nothing about this that I like, because that's significant," Erickson said. "4.03 mills is significant."

Before either of the budgets becomes official, the governing boards must conduct a public hearing and then pass the documents, which lay out spending plans for the coming year.

Both bodies are expected to conduct budget hearings on Aug. 13 followed by votes on the spending plans.

Erickson is proposing a levy of 54.696 mills for 2007-08, up from 50.669 for 2006-07.

He said the repayment of bonds was the driving force behind his recommended mill levy increase. But it is bonds that date to the late 1980s for the building of the former Tonganoxie Junior High School -- not the $25.4 million bond issue that passed in 2004 -- causing the mill levy increase.

The junior high, which was built west of the high school, now is part of high school campus after a new middle school was built last year on Washington Street.

Erickson said that the district needed to pay off a principal balance of $400,000 on the former junior high. Another payment in 2009 of roughly $105,000 should complete the repayment for that building, according to Erickson.

"Debt is debt," Erickson said. "We've got to pay off the old debt on the 1987 junior high. That's driving it up because we have a $400,000 principal payment."

Of the district's proposed 4.03-mill increase, 3.92 mills would go toward debt service, while 1.1 mills is for the local option budget.

A mill is $1 in taxes for every $1,000 in assessed valuation.

On a typical $150,000 home, an owner can anticipate paying about $945 to support the school district portion of the overall property tax bill. That would be up about $70 from the previous year.

City seeks 2-mill hike

For the city's budget, Yanez is proposing a 34.724 mill levy for 2008, up from 32.648 for 2007.

In a memo to the City Council, Yanez wrote the greatest factors causing the increase were the number of street projects in the capital improvement plan and the decrease in general funds carried over from the 2007 year.

There was a $1 million carryover from 2006 to 2007. The city projects the carryover for 2008 to be about a third of that.

In the past 10 years the city has consistently kept the levy below 34 mills, with the exception of 2002 when it rose to 34.552 mills.

On a typical $150,000 home, an owner can expect to pay about $599 in taxes to support the city budget as proposed. That would be up about $35.83 from the previous year.

Another factor in the proposed increase is the assessed valuation for the city. It came in just 6 percent higher this year, only half as much as last year's increase. In each of the past seven years, the assessed valuation for the city has increased by more than 10 percent.

In the proposed budget, Yanez has figured in a cost-of-living adjustment of 2.5 percent for city employees, down .8 of a percent from the national cost-of-living adjustment last year.

To cut back on some of the expenses for the 2008 budget, the city has removed the request for any new staff, including a new police officer and firefighter.

The City Council met Tuesday night -- after The Mirror's deadline -- for a work session on the budget.

"No governing body wants to raise taxes ever," Mayor Mike Vestal said during a June 29 interview. "If it had been done gradually over the years, it would have been easier on the taxpayer's pocket book.

"It's just the cost of doing business, we have to be able to operate."

Leavenworth County Clerk Linda Scheer said tax statements would be sent out homeowners in November, with the first half of taxes being due Dec. 20.

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