CEDAR RAPIDS — Cedar Rapids City Council and the Linn County Board of Supervisors on Tuesday each formally approved budgets without dissent for the fiscal year that begins on July 1.
Each of those budgets increase property taxes on residential owners in cities a small amount while reducing the tax — as dictated by a new state directive — on commercial and industrial property owners.
The city and county governments comprise two big parts of the local property-tax bill, with the school district where a person resides the third big part.
Homeowners in Cedar Rapids will see a 2.99 percent increase in the city’s portion of the local property-tax bill — about 40 percent of the total — and a 3.4 percent increase in the county’s portion of the bill — about 16 percent of the total.
The increases come largely because of a state "rollback" formula, which will make 54.4 percent of the value of a residential property subject to property tax, up from 52.82 percent of value.
Residential property owners in unincorporated Linn County outside of cities get special treatment. They will see a property-tax reduction of 6.6 percent because of the county’s decision, approved by voters, to use revenue from the county’s portion of the local-option sales tax, in part, to hold down property taxes in unincorporated Linn County.
A state directive reduces from 100 percent to 95 percent the amount of commercial and industrial property value subject to local property tax. The state has said it will reimburse local governments for the loss in revenue.
Both the Cedar Rapids City Council and the Linn County Board of Supervisors also are being helped in balancing their budgets because the overall taxable value of property upon which property taxes are based has continued to increase in both jurisdictions.
The city of Cedar Rapids also is being helped by $18 million in revenue from the local-option sales tax, which means the city will not need to take on new debt to fix streets in the new budget year.
The city also receives about $3 million in net revenue from traffic enforcement cameras and about $5 million from a 2 percent franchise fee on electric and gas bills.
The city’s tax rate remains the same for the new budget year, $15.22 per $1,000 of taxable valuation, the second lowest among Iowa’s largest eight cities, after Dubuque.
In Linn County’s portion of the overall local property-tax bill, the tax rate in cities will be $6.14 per $1,000 of taxable valuation, up 3 cents per $1,000 of taxable valuation.
In unincorporated Linn County, the county rate will drop to $8.92 per $1,000 valuation from the current $9.83 per $1,000 after tax relief from the local-option sales tax is factored in.
The city budget increases employee wages by 2 percent and the county’s budget increases wages by 2.3 percent for bargaining employees and 2.25 percent for non-bargaining employees and elected officials.Casey Drew, the city's finance director, and Dawn Jindrich, the county's budget director, provided the details of the budgets on Tuesday.