BY ANDY TAYLOR
chronicle@taylornews.org
INDEPENDENCE — Montgomery County taxpayers can expect to see a slight drop in the tax rate assessed for county programs and services in 2011.
Montgomery County commissioners voted unanimously to propose a 2011 budget that calls for the county’s mill levy, also known as a tax rate, to decline from 52.10 mills in the current 2010 budget year to 47.09 mills in 2011.
That 5.01-mill decrease represents an 9.6 percent decrease in the county’s mill rate.
For a residential property valued at $100,000, the 5.01-mill decrease would lower property taxes for Montgomery County’s share of programs and services by $57.62 ($599.15 in the 2010 budget compared to $541.53 in the proposed 2011 budget).
For a commercial property valued at $50,000, the decrease mill levy would lower property taxes for Montgomery County by as much as $75.15 ($781.50 in 2010 compared to $706.35 in 2011).
This does not take into account the property taxes collected for school districts, city governments, community colleges, townships, cemetery districts, or other local governmental entities.
The decision to reduce the county’s tax rate by 5 mills was a far cry from what the commission experienced one year ago, when commissioners adopted a 2010 budget that called for a precedent setting 23 percent hike in the county’s tax levy. Commissioners noted they had a goal this year of presenting a 2011 budget plan that had at least a 5-mill reduction in the county’s tax rate.
When they began discussion Monday morning on the 2011 budget plan, commissioners learned through Larry Wright, a Coffeyville certified public accountant who prepares the budget document for the commission, that they were about $93,000 off from reaching that 5-mill reduction mark.
So, commissioners began reducing expenses, including a $60,000 hit to the county treasurer’s department. Commissioner Fred Brown noted that the treasurer’s office had consistently returned about $60,000 to the county’s general fund each year through unspent money.
Commissioners said they were satisfied with a budget plan that calls for a decrease in property taxes for the county’s share of programs and services.
“That’s been our goal from the start of this process: to lower taxes,” said commissioner Fred Brown.
The proposed 2011 budget plan wasn’t created easily. It required substantial reductions in expenses, including a 10 percent reduction in county taxpayer contributions to all non-courthouse agencies, including the Montgomery County Action Council, Four County Mental Health Center, Class LTD, Kansas State Research and Extension Council, and the Montgomery County Conservation District.
Most county courthouse departments also took a budget hit with most departments submitting budgets that not only eliminate pay increase but also slashes spending and, in some cases, reduces employment levels.
The proposed budget shows estimated county expenditures in 2011 at $23,447,314 — down from the $27,794,652 that is estimated to be spent in the current 2010 budget year. That’s a difference of about $4.3 million, or a reduction of more than 15 percent.
Complicating the preparation of the 2011 budget was the need to set aside a large volume of taxes paid by Coffeyville Resources LLC, which is currently protesting the increase in its property assessment of its nitrogen fertilizer plant. That protest is being heard in the Kansas Court of Tax Appeals. Also appealing the increase in their property tax appraisals to the tax appeals court are Linde, Inc., formerly known as BOC, and Tessenderlo-Kerley (TKI), which are companies located within the Coffeyville Resources refinery area.
The total amount of tax money that is the subject of the protest is about $26 million. The commission agreed to set aside about 55 percent of that $26 million in the Montgomery County in anticipation of a tax rebate to those companies (subject to a decision of the tax appeals court).
That tax protest also puts a crimp on the county’s total assessed valuation, which is the cumulative sum of all taxable properties in the county. Wright said the total assessed valuation for Montgomery County was $365 million, however the commission can only use a $313 million valuation in forming the 2011 budget due to the property tax appeals filed by Coffeyville Resources and the affiliated companies in the refinery complex.
Should the tax appeals court rule in favor of Montgomery County in those tax protests, then the county can use that “set aside” money paid by Coffeyville Resource to reduce the county’s tax rate in the following budget year, Wright said.
Commissioners and Wright also took time to correct a myth that county government was broke because of the property tax protests filed by Coffeyville Resources.
In fact, Coffeyville Resources continues to pay its property taxes in full, Wright said. However, more than half of the property taxes paid by Coffeyville Resources will not be spent by the county until the tax appeals court issues a ruling in the battle over appraisals.
“The county is in good financial shape,” Wright said at Monday’s meeting. “We are not broke.”
A summary of the proposed 2011 budget plan will be printed in an upcoming edition of the Independence Daily Reporter, which is Montgomery County’s official newspaper for legal notices for 2010.
A public hearing will be held at 9:15 a.m., Monday, Aug. 9 in the basement of the Montgomery County Judicial Center for county residents to express concerns or ask questions about the proposed use of funds in the 2011 budget plan. Copies of the budget can be viewed at the Montgomery County Clerk’s Office during regular business hours.
After that hearing is held on Aug. 9, commissioners will decide whether to adopt the 2011 budget. Commissioners have the option at that time of lowering the mill levy and expenditures further . . . however they are not allowed to raise the mill rate above the proposed 47.090 mill levy.
