CEDAR RAPIDS — The Linn County Board of Supervisors on Wednesday approved its new budget that reduces the county portion of the local property bill for rural homeowners outside of cities and for owners of farmland and businesses.
At the same time, homeowners in cities will see a small property-tax increase in large part because of a state formula which increases by 3 percent the amount of valuation of residential properties subject to tax. In the new budget year beginning July 1, 54.4 percent of a home’s value will be subject to property tax.
The owner of a $100,000 house in a city in Linn County will pay $11 more in the county portion of the property-tax bill or $334, up from $323 in the current budget year.
Voters in unincorporated Linn County extended the 1-percent local-option sales tax in 2012 for 10 years, and 25 percent of the revenue from that tax is directed to property-tax relief for homeowners outside of cities in rural Linn County.
As a result, those homeowners will see a 6.6-percent decline in the county portion of their property-tax bill. That means the owner of a $100,000 home will pay $485 for the county part of their property-tax bill, down from $519 in the current budget year.
In the property-tax math, local jurisdictions set a tax levy rate, which is expressed in dollars of tax per $1,000 valuation.
The county’s tax levy rate is higher for residents outside of cities to cover the costs, for instance, of rural roads. Residents in cities pay property taxes to cities that rural residents don’t.
The supervisors’ new budget raised the county levy rate three cents per $1,000 of taxable valuation.
In cities, the county rate will increase to $6.14 per $1,000 of taxable valuation. For homeowners outside of cities the county rate drops to $8.92 per $1,000 valuation after tax relief from the local-option sales tax is factored in for them.
The county’s new budget will provide a 2.25 percent wage increase for county employees.
In the new budget year, the county will have the equivalent of 765 full-time employees, down 23 from the current budget year.
The county’s Community Services Department reduced programming that eliminated 26.5 positions, funding for which had not come from the county’s property-tax-supported general fund, Budget Director Dawn Jindrich said on Wednesday.
Jindrich said commercial property-tax payers in the county will see the county portion of their tax bill reduced by 5 percent while owners of farmland will see a reduction of 3.5 percent.
Jindrich said the county portion of a property-tax bill is about 16 percent of the total for those living in cities and about a third of the bill for those living outside of cities who do not pay city property taxes.
Supervisor Brent Oleson said the slight increase in the county’s levy rate taken by itself boosted the property tax for a homeowner by less than $2 a year, by less than the cup of Starbuck’s coffee he was drinking at Wednesday’s meeting.
Supervisor John Harris said he disagreed with the board’s decision to raise the levy rate by 3 cents per $1,000 valuation, but he said he still would vote to approve the budget.
Wednesday’s vote gave Jindrich permission to publish the new budget.