SIOUX CITY | It will take a March 15 public hearing and then vote to make it official, but Woodbury County Board of Supervisors Chairman Jeremy Taylor on Tuesday guaranteed that the property tax levy in the upcoming 2016-17 fiscal year will be reduced for a second consecutive year.
Taylor praised the work of the supervisors in making cuts to proposed spending and other moves since the budget discussions began in December. On Tuesday, the supervisors approved a few higher expenses, some additional revenues and shifts in funds to reduce property taxes. The budget is looking to be less than $52 million.
Taylor said the work will mean the property tax levy rates for both rural and city property owners for the county budget will go down for the year that begins July 1. However, because of higher property assessments, the property taxes that some people pay will go up, if the higher valuation outstrips the levy drop. The full tax bill is computed by multiplying the tax levy rate by assessed property valuation.
"It is a very responsible budget," Taylor said.
After the changes made Tuesday, a summary of fiscal year 2016-17 shows the county's property tax levy for town residents now stands at $7.37 per $1,000 of assessed valuation, compared to $7.52 in the existing 2015-16 fiscal year budget.
For rural residents, the estimated levy rate is at $10.42 per $1,000 for FY 2016-17, compared to $10.64 in the current year.
The budget will be adopted on March 15. The main two decisions remaining before that will come at one more meeting on Feb. 23, when the supervisors will discuss larger projects in the multi-year Capital Improvement Program and when a decision is made on whether to exceed the state-set cap on the General Basic Fund.
The county puts property taxes into five separate accounts, including the General Basic Fund, which has a state-recommended cap of $3.50 per $1,000 of assessed property valuation. Counties can exceed that so-called cap if they hold a public hearing to let people know the change is coming, Woodbury County Finance Director Dennis Butler said.
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In a non-agenda item, Taylor raised a proposal that since the county is doing so well in reducing the tax levy that the supervisors should increase the county's reserves level. Supervisors Jackie Smith and Larry Clausen quickly spoke against that, saying it isn't necessary, if that means lifting the $3.50 per $1,000 General Basic Fund cap.
Butler said the existing reserves level in the FY 2016 $51.5 million budget is 19.6 percent, and Taylor said he wanted to raise that by 1 percent, to 20.6 percent. That would involve raising taxes by $290,000, which Taylor said is defensible, since even if pursued, the tax rate still will be below this year. Taylor said he wanted to get closer to recommended threshold of having 25 percent reserves.
Smith, in her eighth year as a supervisor, said Woodbury County has a long history of not exceeding the $3.50 cap. She said exceeding the cap would be highly unpopular with residents. Clausen spoke similarly, citing his opposition to taking that step.
Supervisor Mark Monson joined Taylor in his view: "I don't get concerned about that $3.50 cap."
Taylor said even raising the cap beyond $3.50 to increase reserves would put the tax levy rate at $7.48 per $1,000 of value for city owners and $10.52 for rural owners, both still below this year's rates.
"The levy rate will go down significantly, that is the whole point," Taylor said, adding that people only judge a budget based on the tax rate they pay.
Butler said 23 of 99 Iowa counties exceed the $3.50 cap, adding, "A lot of counties haven't done it."
In other budget discussions, the supervisors received a report from a meeting of the Woodbury County Compensation Board. That board meets once annually to recommend salaries for the nine elected county officials -- the five supervisors, and county attorney, sheriff, auditor and treasurer.
The compensation board recommended 5 percent raises for all nine officials. During the March 15 final budget hearing, the supervisors will either approve the recommended increases, give no raises or make reductions of the same percentage amount to all nine.