Mason City council adopts maximum tax levy for FY 2024 budget
MASON CITY — The City Council in Mason City last night adopted a resolution setting the maximum property tax dollars to be levied for the city’s Fiscal Year 2024 budget.
The state legislature a few years ago passed a law mandating that cities and counties hold a so-called “max levy hearing” in addition to the hearing prior to the formal adoption of the budget. The current levy is $11.33 per $1000 assessed value, compared to the proposed levy of $10.94 per $1000.
Cities and counties have been dealing with an error in the formula that determines some property tax rates, an error that is costing the city of Mason City between $350,000 and $400,000 in revenue that was originally anticipated. City finance director Brent Hinson says the city still has its best options in place with the proposed levy. “This max levy does not touch the debt service levy for example. Really, if we were going to adjust our property tax levy, the place that I would recommend adjusting it is we backfill that debt service levy very significantly with other funds, like local option sales tax, water funds, sewer funds, etc. I would recommend that we would take a look at pulling some of those funds back and then having a higher debt service levy to offset changes if we needed to.”
Hinson told the council he believed despite all the questions about the error and how it may or may not be corrected, it was safe for the council to approve the maximum levy. “This max levy frankly probably wouldn’t change in any scenario, so I think we’re very safe in council taking action. I think in the absolute worst-case scenario what we would have to do is republish and hold a second max levy hearing. I don’t think that’s going to be the case at all. I think it does make sense for the city at this point with the uncertainly to wait on the final budget hearing.”
The legislature last week passed a bill giving cities and counties until April 30th, an extra 30 days, to complete their spending plans for the budgeting year that begins on July 1st.