Proposed tax rate marks third straight year of decline
For the third straight year, the property tax asking within the City of Clear Lake will drop.
City Administrator Scott Flory delivered the first of three presentations about the proposed 2019 fiscal year city budget during the regular City Council meeting Monday night, Feb. 5. The proposed tax rate is $9.70 per $1,000 of taxable valuation.
Flory pointed out that for fiscal year 2017 the city’s tax rate decreased from 410.54 to $10.04; for fiscal year 2018 the rate was cut to $9.80; the fiscal year 2019 rate, which begins on July 1, 2018 and ends June 30, 2019, goes down 10-cents more, to $9.70.
“The City’s tax rate, therefore, has decreased by nearly 85-cents per $1,000 of taxable valuation over the last three years,” he noted.
The city’s tax rate continues to be among the most enviable in the state, ranking it fourth lowest among Iowa cities with a population over 4,000. Using the proposed rate would mean the city would have only 3.7 percent of its debt capacity used.
“Anything under 5 percent of debt is basically no debt and is practically unheard of in the country,” said Flory. “We pay cash as we go and that results in very little debt. That’s rare company to be in.”
Flory’s presentation, which will be repeated at the Feb. 19 meeting and again at a public hearing March 5, pointed out Clear Lake’s low tax rate are a major reason for businesses to consider locating here.
For example, Flory noted Clear Lake’s tax rate is approximately $4.10 per $1,000 of taxable valuation less than neighboring Mason City. Using the McKesson Corporation, which located in Clear Lake in 2016, as an example, Flory said the pharmaceutical distributor pays $70,000 less annually in city taxes to be here, rather than Mason City. Figuring the same scenario with rates from all taxing entities (school, city, NIACC, county and sanitary district), the consolidated tax rate for Clear Lake is $28.29 per $1,000, while Mason City comes in at $35.62. Those numbers mean McKesson saves $117,000 annually by doing business here.
Although the city’s tax asking keeps dropping, Mayor Nelson Crabb and Councilmembers joined Flory in noting the city’s tax asking is basely one-third of the overall tax bill residents will receive.
The Clear Lake School District receives about 37 percent of the consolidated tax asking, while the city is approximately 35 percent, county is 24 percent, and NIACC and sanitary district about 2 percent each.
Clear Lake’s taxable valuation for the 2019 fiscal year continues the positive trend of growth in the community, according to Flory. The taxable valuation is $607,348,889, which is a $21,052,154 increase (3.6 percent) from fiscal year 2018.
The proposed 2019 budget reflects total expenditures among the various programs of slightly over $13.5 million, of which $8.3 million is directed toward operations and maintenance; $4.7 million toward capital; and $500,000 to debt service.
Veterans Memorial Golf Course
In other business Monday night, the Council heard an annual report provided by Tom Fey, president of the Veterans Memorial Golf Club board. Fey said gross revenue for the city-ownedTo read more of this article, please login or sign up for our E-Edition