MP holds the line on taxes, property valuation increases

BY BROOKS TAYLOR

Mt. Pleasant News

Taxable valuation, arguably, is the engine that drives budget revenue.

If that?s the case, the City of Mt. Pleasant?s fiscal year-ending 2017 budget is purring.

Although Mt. Pleasant?s valuation has generally shown modest gains, taxable valuation for next year?s budget grew by over $7 million.

According to city figures, taxable valuation for the 2016-17 budget is $292,054,555 compared with $285,193,757, for the current budget year. Meanwhile, assessed valuation in fiscal 2017 is nearly $408M, or $13 million more than in fiscal 2015-16. The difference between assessed and taxable valuation is that taxable valuation accounts for the residential, and commercial and industrial property tax rollbacks.

?The valuation increase really helped,? observed City Administrator Brent Schleisman. ?It made things easier and was a fairly healthy climb. If we don?t grow (in valuation), I doubt the levy would stay at where it is without cutting something.?

Schleisman said the valuation increase also enabled the city to keep the total property tax levy of $12.18 per $1,000 taxable valuation the same as it was for the current budget. The general fund levy is at the maximum $8.10 per $1,000 taxable valuation.

Mt. Pleasant?s budget also has a debt service levy of $3.15 and an employee benefit levy of $0.92. Both figures are based on per $1,000 taxable valuation.

Next fiscal year?s city budget calls for $27,127,859 in expenditures, compared with expenditures of $30,092,570 this budget year. Revenues are projected at $26,973,493 for fiscal 2017, according to the budget estimate published in the Mt. Pleasant News. The city is also anticipating a general fund beginning balance on July 1, 2016, of $2,890,969. The ending balance on June 30, 2017, is projected at $2,444,493. The most significant difference between the beginning and ending fund balance is the planned purchase of a fire truck, estimated at $450,000.

Fiscal 2017?s residential rollback is 55.62 percent meaning residential property is taxed at 55.62 percent of its assessed valuation. For instance, a house with an assessed value of $200,000 would be taxed at a value of $111,240. This also is the first year in which there is a rollback for multi-residential property (i.e. apartment buildings). Multi-residential property will be taxed at 86.25 percent of its assessed valuation.

Commercial and industrial property has a 10-percent property tax rollback this year with the state ?backfilling? the lost property tax revenue.

The city is budgeting for a 2.5 percent increase in employee salaries and a health insurance increase of 20 percent.

Following are some of the noteworthy items in each budget account.

General fund

Revenues ? Hotel/motel tax dollars are projected to remain at $140,000; a contribution of $100,000 from Mt. Pleasant Municipal Utilities. The city is also anticipating $128,582 from the state in reimbursement for lost commercial/industrial property taxes due to the 10-percent rollback.

Expenditures ? Capital purchases amount to $587,500. Hotel/motel tax revenue will be used to contribute $20,000 to continue tuckpointing the exterior of the library/civic center building; $30,000 toward the construction of a splash pad; $10,000 in marketing funds to Midwest Old Threshers; $10,000 to the Mt. Pleasant Historic Preservation Commission; and $7,000 for unforeseen tourist events.

Capital projects fund

Revenues ? Mt. Pleasant will receive a grant of $994,000 that will help pay for the Mapleleaf Drive reconstruction project. The fund includes a transfer of local option sales tax funds of $300,000 to pay for the Winfield Avenue reconstruction project (summer of 2017 from the overpass to Grand Avenue). The fund reflects $1,000,000 of new bond money to pay for the Mapleleaf Drive project.

Expenditures ? Top expenditure is the $1,000,000 to finish paying the Mapleleaf Drive reconstruction project.

Debt service

Revenues ? Taxable valuation has increased from $284,190,533 in fiscal 2016 to $291,089,061 in fiscal 2017, generating $917,364 in revenue. The budget shows a transfer of $231,406 in TIF funds into debt service. Revenue also includes a $44,940 reimbursement from the State of Iowa to backfill the loss of commercial and industrial property tax due to the state property tax rollback.

Expenditures ? Most of the expenses in this fund are incurred through paying on bonds for road construction, the library/civic center, fire truck and the Crossroads Industrial Park. Total payments are $1,207,694.

Road use tax fund

Revenues ? Beginning balance is projected at $765,139. Projected ending balance is $707,542.

Expenditures ? The budget includes $75,000 for patch and repair work on city streets. A total of $41,000 is set aside in escrow for future equipment purchases. The city is budgeting $25,000 for the street chip-and-seal program and $150,000 for asphalt overlays on streets. The total expenditures amount to $1,099,597.

Local option sales tax

Revenues ? Beginning balance of $421,699; new sales tax revenues are projected at $750,000.

Expenditures ? A $300,000 transfer to capital projects for the Winfield Avenue reconstruction project.

Sanitary sewer fund

Revenues ? Flow rate increases from $4.70 to $5.00 per 1,000 gallons, which is the second year of the scheduled five-year rate increase. Budget shows borrowing $5.5M from the state revolving loan fund for the Jay Street sewer project. Total revenues generated are projected at $1.83M and beginning balance shown as $897,954.

Expenditures ? Bond payment of $849,686 for the wastewater treatment plant. Another $20,000 budgeted for unexpected sewer repairs that may arise. A total of $5.5M budgeted for the Jay Street sewer project. A total of $46,500 budgeted for equipment escrows.

Solid waste fund

Revenues ? Beginning balance of $189,125. Recycling, Haz-chem administrative fee paid to Des Moines County Solid Waste Commission is increasing by 10 cents to $3.45 per month. Total projected revenues are $412,200.

Expenditures ? A new packer, which will cost $13,000 and a new tub grinder costing $10,000, for the compost site. Tipping fees will be increasing July 1 by $1 per ton at the Des Moines Solid Waste landfill, to $50 per ton. The city typically hauls about 1,000 tons to the landfill per year. Another $18,000 is budgeted for the spring cleanup program.

?The budget wasn?t too difficult (to draft),? Schleisman said. ?It would have been very difficult, if we didn?t have the commercial and industrial property tax backfilled. The growth (in valuation) also helped. It?s a good budget because we can continue with our street reconstruction program and infrastructure improvements without raising taxes or cutting services.?

City council members will host the public hearing on the budget Wednesday, March 2, at 5:30 p.m. in the council chambers of City Hall.