For the fourth straight year, the city of Clear Lake’s property tax levy will remain unchanged.
That’s what City Administrator Scott Flory said while reviewing the proposed fiscal year 2022 budget with the Clear Lake City Council Monday evening.
Under the proposed budget, the tax levy rate would be $9.70 per $1,000 taxable property valuation — marking the sixth consecutive year the city’s tax levy rate has declined or remained the same.
In fiscal year 2017, the city tax rate decreased from $10.54 to $10.04; for fiscal year 2018, the tax rate declined from $10.04 to $9.80; and for fiscal year 2019, the tax rate decreased from $9.80 to $9.70.
Clear Lake has the fifth lowest tax levy rate among the 95 cities with populations of more than 4,000 in the state of Iowa.
“This is one I’m always proud of, even though we dropped one spot this year,” Flory said. “We were fourth for many years, but now we’re fifth. I’m not sure how that happened.”
According to fiscal year 2021 data, the cities of Eldridge ($6.74), Evansdale ($7.95), Dyersville ($9.56) and Asbury ($9.57) have lower tax levy rates than Clear Lake.
The cities with the highest tax levy rates are Ottumwa ($22.46), Fort Dodge ($20.17) and Knoxville ($19.05).
Clear Lake’s proposed fiscal year 2022 property tax rate comprises the general fund levy ($7.63830), tort levy ($0.36147), employee benefit levy ($1.38562) and the debt service levy ($0.31461).
The general fund levy, which funds the city’s public safety, library, park and recreation, public works and administration departments, and the debt service levy are decreasing by a total of $0.09168 per $1,000 taxable valuation from fiscal year 2021.
While the tort and employee benefit levies are increasing by a total of $0.09168 per $1,000 taxable valuation from fiscal year 2021.
Under the recommended tax rate, residential properties with an assessed valuation of $150,000 in Clear Lake would receive a $786 tax bill for city government services, which is $19.43 more than fiscal year 2021.
Flory attributes that entirely to an increase in the state's residential rollback.
The residential rollback for fiscal year 2022 is set at 56.41%, which is an increase from the previous year’s 55.07%.
The taxable valuation for fiscal year 2022 is $728.1 million, which is a $33.3 million, or 4.5%, increase from fiscal year 2021.
“Not quite as significant growth as the year before, but still very positive nonetheless,” Flory said.
Clear Lake’s largest source of revenue is property taxes, which will represent about 40% of the city’s total revenues in fiscal year 2022.
However, it also receives revenue from road use tax, local option sales tax, hotel motel tax and other sources.
Flory said the city of Clear Lake’s tax levy accounted for 34% of the total consolidated tax rate of $28.14955 in Clear Lake, while Clear Lake Schools, Cerro Gordo County, NIACC and the sanitary district comprised the rest.
Based on fiscal year 2021, Clear Lake has the seventh lowest consolidated tax rate among 95 cities with populations over 4,000 in Iowa.
The cities of Spirit Lake ($25.84384), Eldridge ($26.15160), Carroll ($26.84467), Le Mars ($27.46444), Dyersville ($29.89128) and Evansdale ($29.96942) have lower consolidated levies than Clear Lake.
The highest consolidated tax levy rates in fiscal year 2021 were Ottumwa ($49.68477), Des Moines ($49.32249), and Fort Dodge ($48.32414), according to Flory’s budget presentation.
After Flory’s budget review, the City Council unanimously approved a resolution setting a public hearing for the maximum property tax levy for fiscal year 2022, which is from July 1, 2021, through June 30, 2022.
The public hearing will take place at 6 p.m. on Monday, March 1, at Clear Lake City Hall, 15 N. Sixth St.
In 2019, the Iowa Legislature passed a bill that requires cities to approve, by resolution, the maximum amount of tax dollars for the fiscal year budget before it approves its final budget.
If those dollars exceed 102% of the funds collected in the current fiscal year, the vote to approve the resolution must be a two-thirds majority.
The proposed fiscal year 2022 budget is nearly $14.9 million, with $9.7 million going toward operations and maintenance, $4.5 million toward capital and about $706,000 going to debt service.
Flory said the proposed budget was “slightly less fiscally aggressive” than the amended fiscal year 2021 budget of about $18.6 million, which he said was the city’s largest budget in his time as administrator.
Flory prepared the fiscal year 2022 with Finance Director Creighton Schmidt, who was hired in September after longtime director Linda Nelson retired.
Clear Lake Mayor Nelson Crabb and council members praised the men for the budget, and levy, they presented.
“As active as we are here, we do watch our pennies so to speak, and I for one am very thankful,” Crabb said. “We are very, very fortunate to live in a community that’s really aware of its fiduciary responsibilities.”
The final budget hearing will be held March 15.
The 2021-2022 fiscal year begins July 1.
Budget documents are available at City Hall and online at www.cityofclearlake.com ahead of the hearing.
For questions about the proposed property tax levy or budget prior to the hearings, call 641-357-5267.
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Ashley Stewart covers Clear Lake and arts and entertainment in North Iowa for the Globe Gazette. You can reach her at firstname.lastname@example.org or by phone at 641-421-0533. Follow Ashley on Twitter at GGastewart.