We continue this morning with the Prairie Village mayoral candidates’ responses to our questionnaire, which was developed last month with reader input.
Here’s today’s question:
Prairie Village homeowners have seen their appraised home values increase faster than most of the rest of the county the past few years. What’s your view of the city’s property tax rate in the face of these rising home values?
The rapid rise of appraised home values has shocked many residents but is the result of several positive factors coming together. The value of our housing stock is increasing. Prairie Village continues to rank among the highest rated communities in the state for public safety, quality of life, and our schools are nationally recognized.
The City of Prairie Village current mill levy rate is 19.311. In March, Lisa Santa Maria, Finance Director, projected a 4.5% increase in revenue to the general fund in 2019, amounting to $908,053. She explained about 80% of this additional money comes from increased assessed property values.
Compounding the increase in property taxes was the State Legislature’s failure to pass a bill at end of session that would conform Kansas tax code to the new Federal tax code passed in 2018. This will result in many Prairie Village residents not being able to deduct their property taxes, mortgage interest, or medical expenses on their 2018 Kansas Tax filing.
Residents hear all too often that the Mil Levy was not increased or was decreased, but our residents do not pay their property taxes with mils. They pay in real dollars. The city must be disciplined to control cost, and not view the $900 thousand as a windfall that can be used to grow city government. Instead, we must explore avenues to protect residents from skyrocketing property taxes.
One approach may be establishing a percentage cap on annual property tax revenue growth that would protect residents from excessive increases. Another approach may include providing a percentage tax discount for our seniors who have lived in their homes for an extended, defined period. I’m sure there are other ideas the community may have, and I will listen and present these to the appropriate bodies.
Bottom line, as Prairie Village continues to realize tear down / rebuilds, increased property assessment values for the whole community will be realized. The city must be responsible in ensuring additional revenue is used in part to lower taxes for our residents, and as Mayor I will work with City Council, the County, and our legislators to ensure we are tackling this problem that is squeezing our residents.
What’s important is What Matters to You. If you have any comments, questions or concerns please give me a call (913) 777-9597, Please vote for Serena Schermoly for Mayor on August 7 serenaschermoly.org
The appraisals are a result of something we all cherish: the persistent desire of so many people to live in Prairie Village. Higher prices are being paid for houses here and whether a resident is interested in selling or not, this does represent an increase in the value of one of our largest investments – our homes. The news isn’t all good; rising taxes can hurt those on low or fixed incomes. Those who feel that their individual increase is unwarranted can appeal their assessment and there is a degree of success for those who do. For seniors or residents on fixed or limited incomes there may also be provisions of the Homestead Refund or SAFESR refund that might be helpful.
I do not think that the first source of relief should be the city. Prairie Village accounts for only about 15-16% of a homeowner’s property tax bill and not all of the taxing jurisdictions (e.g., the state of Kansas, the county, the school district) are equally impacted by the “Tax Lid” imposed upon us by the Kansas Legislature. The bulk of property tax revenue is taken by the school district and the county. The Tax Lid severely hamstrings a Prairie Village’s ability to cope with growth in population or economic downturn or other uncontrollable rise in expenses. Because of these factors, there is a significant risk for the city in cutting mill rates during healthy times only to face the constraint of the tax lid in rougher times. As the expenses in the early years become our baselines, I believe the Tax Lid effects on the city budget could be as soon as the next 3-5 years. Prairie Villagers should engage their mayor and council in verifying that the city budget contains the frugal expenses and wise investments that sustain the beautiful vibrant city that we live in.
The City should have lowered property tax rates for 2018.
During my term on Council and as Chair of the Finance Committee of Prairie Village, home values rose at an extraordinary rate. This is good economic news for homeowners in the long-run. But for those invested in living here for the long-run, it causes short-term pain through higher property taxes when the tax rate is not adjusted. Out knocking doors I hear about this pain a lot, both from seniors on fixed incomes and from younger families struggling to make ends meet.
As the City’s Finance Chair, I put my background in economics, tax and finance to work to try to get you some relief. The City collected several hundred thousand surplus tax dollars from increased appraised values. By “surplus,” I mean after funding salary increases for our police, after investing more than usual in capital improvements to our roads, after funding parks and drainage, and after funding all of the other services and needs of the City. Including strong “rainy-day” contingency fund balances, all of which I supported.
Even after funding all of those needs, the city still had money left over. So I made a motion at the Council to reduce the property tax rate for 2018, to give that excess cash back to you. It would not have been a huge amount, but it would have been a few extra dollars in your pocket. I’ve met a lot of folks who would have appreciated that. Unfortunately, neither of my opponents supported the motion; it did not pass.
This decision was made tougher by the property tax lid imposed by the State recently, which caused some concern that lowering tax rates might limit flexibility to raise tax rates when the economy turns. However, that property tax lid law (which I would like repealed) includes exceptions such as for public safety, bond payments, inflation, decreases in appraised values, as well as voter-approved tax increases. So we would have been okay.
Each year, prudent budgeting requires us to take a fresh look at projected costs and needs for that year, and compare to expected revenues, to make a new annual decision on tax rates. As Mayor I will take a hard look at property tax relief again if appraisals and revenues keep outpacing inflation. I’ll need your vote and help to do so: mikkelsonforpv.com
Tomorrow we’ll publish the candidates’ responses to item four:
The governing body has considered a number of initiatives in recent years to expand bike and pedestrian trails throughout Prairie Village — but has backed away from some projects after the objection of homeowners. Do you think expansion of bike and pedestrians trails is a priority for the city? If so, what would you do to see such projects become a reality?