Spencer, IA (KICD)–The city of Spencer’s tax levy rate will see it’s first significant jump in years in the coming fiscal year.
The current property tax rate of $11.83 per $1,000 of taxable valuation is slated to increase by 33-50 cents according to Spencer City Manager Bob Fagen who says the increase is needed to cover costs that are out of the city’s control such as a decrease in commercial valuation.
The state has promised to backfill the commercial property tax rollback funding, but that has not been finalized by the state legislature.
If the city council chooses to craft a budget as if the $74,000 in commercial rollback funding is a lock, the tax rate would have to increase by 33 cents with a 50 cent increase if the city acts as if the funding is not a guarantee.
Health care cost increases are the other major factor behind the levy increase.
A 50 cent increase in the city’s tax rate would cost the owner of a $100,000 home $3.50-$3.60 more per month. With the 50 cent increase Spencer’s rate of $12.33 would check in as 13th lowest amongst cities with a population over 10,000 in Iowa where the average is $13.96.
The proposed budget includes a 2 percent salary increase for city employees, no new employees, and does not cut any services.
Proposed solid waste, landfill and sewer rates were also presented last evening.
These rate increases combined with the tax levy rate increase would increase the cost the owner of a $100,000 home pays out by $4 to $5 a month.