Olathe & Southwest Joco

Rising property values boost Johnson County budget

Ed Eilert, chairman of the Johnson County board of commissioners.
Ed Eilert, chairman of the Johnson County board of commissioners. file photo

If the Johnson County Commission passes the proposed 2017 budget next Thursday , total spending will rise next year. But the property tax rate will not.

Instead, the increase in revenue will reflect the growth in the assessed valuation of property within the county, which is projected to be about 7.4 percent greater than 2016.

That means the budget will grow from about $929 million to nearly $944 million. But the mill levy will remain stable at about 26.6.

That was the upshot of a public budget hearing Monday evening at the county office building in Olathe.

This translates to a $3.08 monthly increase in property taxes for the owner of an average home in the county. Overall, the property tax bill for such a homeowner will jump to nearly $70 month, or $835 a year.

Residential property values are estimated to have increased by 4.6. percent year-over-year, while the remaining increase in assessed valuation comes from the addition of commercial property.

Ed Eilert, chairman of the board of commissioners,said he had heard talk during this election season about a “secret tax increase” resulting from the increase in assessed valuation. But he called such notions “nonsense.”

“Property values are finally going up, and that’s a good thing for everybody,” Eilert said. “The average home gained $12,000 in value, and for that you will pay a little higher taxes. It will cost you $3.08 a month to gain that. That helps put it into perspective.”

Commissioner John Toplikar noted the budget is projected to rise by more than $15 million, “and that’s the number we will have to explain to the public.”

The growth in the budget will bolster the county’s reserve funds. Actual operating expenditures will drop by $8.3 million in 2017, while reserves will grow by $23.6 million.

Of that reserve-fund growth, about $18.3 million will be devoted to saving up for a new Tomahawk Creek wastewater treatment plant.

The county now sends some of its wastewater to Kansas City for treatment, and a new plant will handle more of the flow, if not the entire amount.

Commissioner Steven Klika complimented the county staff, saying they had done a good job of dealing with reduced assistance from Topeka and jobs cut in the wake of the Great Recession.

Klika also mentioned the property-tax lid passed by the state legislature last year. Starting in January 2017, with certain exceptions, the tax lid will prevent local governments from raising tax rates more than annual increase in the Consumer Price Index without a public vote.

“We do have challenges coming up,” Klika said. “The tax lid does not take into consideration future growth. I applaud this commission for taking a breather. We’ve seen some local governments trying to get ahead of the tax lid, but we’re choosing not to. We’ll take each year as it comes.”

Eilert also commented on the tax rate formula, saying the CPI “has no relation to government expenditures. It’s a flawed formula to use.”

He said, too, that continued reductions of funding from state government coupled with the property-tax lid threatened to put pressure on the county’s budget in future years and impact the top rating Johnson County enjoys from the three major credit-rating agencies for its general obligation bonds.

No residents spoke during the public-hearing portion of the meeting.