Revenue neutral notification deadline approaches for taxing entities
The process of preparing annual budgets has changed this year for local taxing entities because of a new state law. And local governments have until July 20 to notify the county clerk if they plan to exceed what are considered revenue neutral property tax rates for next year.
Taxing entities will exceed the revenue neutral rates if they collect more money through property taxes than the previous year.
Local taxing entities use mills to determine property taxes. Even if a local government's mill levy remains flat or even is slightly reduced, the entity may be able to collect more tax money than the previous year, and exceed the revenue neutral rate, if there has been an increase in assessed property valuation.
Local governments that intend to exceed their revenue neutral rates will be required to conduct public hearings on the matter before approving their 2022 budgets.
This requirement is part of a new law that was passed earlier this year by the Kansas Legislature. Supporters of the legislation have referred to it as a truth in taxation law and a tax transparency law.
County Clerk Janet Klasinski said she already has received notification from some of the local governmental bodies indicating they intend to exceed their revenue neutral rates for 2022. She said local taxing entities that do not provide her with notification by July 20 will be unable to exceed their revenue neutral rates.
Klasinski said governmental bodies that intend to exceed revenue neutral rates have to provide her with their tentative mill rates for 2022 as well as information about when they plan to conduct public hearings on the matter.
Members of the Leavenworth Board of Education and Lansing Board of Education were scheduled to discuss their school districts' revenue neutral rates when they met Monday night.
This story went to press prior to the school board meetings.
Members of the Leavenworth County Commission are scheduled to discuss their revenue neutral rate when they meet Wednesday.
In the past, local governments have been required to submit their annual budgets to the County Clerk's Office by Aug. 25. But the schedule has been modified for entities that plan to exceed the budget neutral rates.
Klasinski said these governmental bodies will have to conduct public hearings on exceeding their revenue neutral rates between Aug. 20 and Sept. 20.
As in the past, these entities also will be required to have separate public hearings on their proposed budgets. Klasinski said the governmental bodies will be able to schedule the revenue neutral and budget hearings on the same day, with one hearing immediately following the other.
Local governmental bodies will be able to approve their 2022 budgets following their budget hearings.
Beginning next year, the County Clerk's Office will be required to mail notices to taxpayers regarding which entities intend to exceed their revenue neutral rates for the following year. But the state law does require that these notifications be sent this year.