City budget proposes flat property tax levy
The Leavenworth city manager said the city’s property tax levy remains “essentially flat” in a proposed 2021 operating budget.
City Manager Paul Kramer reviewed the budget Tuesday during a meeting of the Leavenworth City Commission.
Commissioners will spend more time reviewing the proposed $58.9 million budget Friday during a day-long work session.
The deadline for commissioners to adopt a 2021 budget for the city is next month. Commissioners will have to hold a public hearing before voting to approve a budget.
“The 2021 operating budget is balanced as required by state law,” Kramer said during Tuesday’s meeting.
He said the mill levy for the city-supported portion of the proposed 2021 budget is 26.902 mills.
Mills are used in calculating property taxes.
Kramer said the proposed mill levy represents a minuscule increase from the 2020 mill levy of 26.898 mills.
Even with a flat mill levy, some homeowners could see an increase in the amount of property taxes they have to pay if the valuation of their homes increases.
The city’s budget also includes mill levies submitted for the Leavenworth Public Library. One proposed mill levy of 3.75 mills would pay for library operations. This is the maximum amount allowed for this levy, according to budget information prepared by city staff.
A second library mill levy, which supports an employee benefits fund, fluctuates based on cost. The proposed amount for this levy for 2021 is 1.154 mills, which is an increase of 0.074 mills from 2020.
Kramer said the 2021 budget has been put together during the most fiscally uncertain period in recent history.
He said the largest revenue source for the city is sales tax. Money from sales taxes provides about 45% of the revenue for the city’s operating budget.
But the impact of the COVID-19 pandemic on the sales tax revenue remains unclear.
Kramer said the city has seen strong sales tax growth during the last five years. But to be conservative, a flat sales tax revenue is budgeted for 2021.
Kramer said there also is uncertainty about funding the city may receive as a result of the federal Coronavirus Aid, Relief and Economic Security Act.
He said the city government is eligible for $6.7 million in funding from the C.A.R.E.S. Act.
“However, we don’t have that money right now,” he said.
He said city officials do not know if their intended uses for the funding will be deemed eligible.
“So we don’t know how the C.A.R.E.S. Act funding would impact the 2021 budget,” he said.
Kramer said no increase is being recommended for fees for the city’s garbage collection service for 2021. There was a 6% increase for this year.
Kramer said there is a recommended 3% increase for sanitary sewer fees for 2021. There was an 8% increase for 2020.
Kramer said the proposed 2021 budget includes a 2.5% across the board pay increase for city employees. If approved, the pay raise would be implemented in the middle of next year.
He said $123,218 also is budgeted in 2021 as part of phased adjustments to salaries resulting from an employee classification and compensation study.
Kramer also reviewed the proposed Capital Improvements Program, which is a five-year plan that budgets for various street and building projects as well as equipment purchases.
Much of the CIP is funded through sales taxes. Because of uncertainty about sales tax revenue, a tiered system was developed.
Tier 1 CIP projects include public safety and infrastructure projects for next year. Tier 2 projects are scheduled for 2022 but they can be moved up if funding becomes available.
Included in the tier 1 projects is $50,000 in funding for public transportation.
According to Kramer, this represents the city’s portion of funding for a public transportation program if Leavenworth receives a state grant.
“We understand that that is a high priority for the City Commission and the city as a whole,” he said.
Commissioners are scheduled to meet at 9 a.m. Friday at the Riverfront Community Center, 123 S. Esplanade St., to review various portions of the proposed budget.
In recent months, members of the public have been unable to attend City Commission meetings because of the COVID-19 pandemic. People have been able to watch the meetings live on the internet or television.
Kramer said Friday’s meeting is open to members of the public.