City proposes mill levy without council voting
Without a city council vote or even discussion of what the money would be spent on, Marion has notified the county that it plans to raise taxes by as much as 13.5% next year.
Part of the increase — 3.4% — is straightforward and was disclosed in a notice signed last week by city clerk Janet Robinson and bearing the city’s official seal.
It calls for a 2.469-mill increase in the city’s property tax rate from this year’s rate.
The remainder of the 13.5% is less visible to average citizens. It is attributable to an 8.901-mill increase over the city’s so-called revenue neutral rate.
That rate, calculated under state mandate, is what the city would charge to get the same amount of property tax revenue next year as it received this year.
Revenue neutral rates tend to be lower than previous years’ rates because of reappraisal of property values. And in Marion’s case, large numbers of properties have been appraised as worth more and thus owing more taxes at the same tax rate. (See accompanying story.)
Like the city, the county has decided to ignore its revenue neutral rate and increase its mill rate by 1.3% over this year’s.
The difference is, county commissioners had an actual recorded vote — 4-1 on July 14, with Jonah Gehring opposed — to do so.
Hillsboro’s city council also took a recorded vote July 11 on exceeding its revenue neutral rate and proposing a rate of 42.621 mills, 45% lower than Marion’s rate and almost a full mill below last year’s Hillsboro rate.
In Marion’s case, there is no recorded vote or even of discussion about what the proposed mill rate should be.
Robinson’s notification informed County Clerk Tina Spencer that the city had decided it needed more than its revenue neutral tax rate, 65.873 mills, and planned to impose a rate of 74.477 mills, up from 72.305 this year.
State law requires that the governing body of each taxing unit notify the county clerk of its intent no later than July 20 — the same day that Robinson provided her notice.
Asked under the Kansas Open Records Act to provide “copies of any meeting minutes or other documents providing evidence of a decision by Marion City Council to exceed its revenue-neutral rate and propose a mill levy of 74.774,” city administrator Brogan Jones provided only a copy of council minutes from July 5.
The minutes make no reference to a vote by the council or to the 74.774 rate. They state only that accounting consultant Scot Loyd “discussed the 2024 Budget with council members.”
“Loyd explained the budgeting process, and went over where he was at with putting the City of Marion 2024 budget together,” the minutes state.
“After discussion, Loyd will be contacting Jones and Robinson for additional information needed so the county clerk’s office can be notified by the last day (July 20th, 2023) of the cities [sic] intent to levy above the RNR.”
In questioning Robinson’s notice Monday night, council member Ruth Herbel said she recalled discussion that the council might have to vote on exceeding the revenue neutral rate but that no decision actually was reached.
She asked Jones when the council voted.
“You don’t have to take a vote for it,” Jones said, “because this is just your intent.”
Herbel noted that statutes specify that “the governing body” is responsible for making this decision.
Jones countered: “I’m an extension of the governing body.”
The only mention of a tax rate in a 22-page handout distributed July 5 by Loyd was the current rate and the neutral rate, not the higher 74.774 rate mentioned in Robinson’s notice.
Jones, Herbel, and others who attended that meeting also admit that the handout and ensuing discussion provoked little or no talk of specific spending plans or tax rates.
“No discussion,” Jones said Monday. “Nobody said no.”
So staff apparently took it upon itself to come up with a rate.
“Common sense, common practice says you’re going to levy over last year,” Jones said.
But Herbel pointed out that she had informed Jones on the same day as Robinson’s notice was signed that she was opposed.
“I told you definitely I was not going to approve exceeding this neutral rate,” she said.
Mayor David Mayfield countered: “Well, you’re one vote.”
The handout July 5 contained only three pages making budget requests.
An unsigned, single-page, hand-written note suggested a need for $150,000 in lining and repair of sewer lines, $80,000 for a water plant system, $90,000 for a skid loader, $80,000 for a mini-track hoe, $45,000 for a fleet truck, $15,000 for a mower, $285,000 for a street sweeper, $43,019 for an additional street and alley employee, and $170,000 for street replacement.
A two-page, typed note from Police Chief Gideon Cody asked for $35,000 for a replacement vehicle, $2,800 for uniform cleaning and rental, and $650 for a wired phone line and improved Internet access at the police office.
No other budget requests were included. Numbers for certain funds were provided, but both Loyd and Jones said afterward that these were just unmodified duplication of numbers from the year before.
State law (KSA 79-2988) provides a penalty if a city fails officially notify the county clerk by July 20 that it plans to exceed the neutral rate. The taxing unit involved must refund to taxpayers any amounts it collects in excess of the neutral rate.
Asked whether a note from a city clerk, absent an official vote of the governing body, was sufficient, Spencer said:
“The notice is to notify me of the district’s INTENT to exceed the revenue neutral rate. Once filed, the information may or not match the final budget. Entities cannot exceed the amount indicated on that form when they approve their final budget. They can approve a budget that includes a LOWER tax.”
The July 20 deadline is designed to allow clerks time to prepare notices, required under law, that must be sent to taxpayers before any formal budget hearing, which is Marion’s case is scheduled for Sept. 5.
Spencer says the council has until that hearing to pass a binding notification of exceeding the rate.
However, attorney Max Kautsch, president of the Kansas Coalition for Open Government, isn’t so sure.
“Exceeding the RNR involves assessments on taxpayers, so it would seem to require binding action,” he wrote in answer to an email query. “Without binding action to direct the clerk to deliver the notice, it would appear the notice is ineffective.”
If it is ineffective, the City of Marion might be locked into living with the revenue neutral rate instead of the rate 8.901 mills higher that Robinson’s notice proposes.