HomeMy WebLinkAbout2024-08-20 Staff Council Email Chain
Chris Johnson
From:Todd Lavoie
Sent:Tuesday, August 20, 2024 1:33 PM
To:citycouncil
Cc:Department Directors; Chris Johnson; Jenny Fields; Ricardo Ortiz Miller
Subject:FW: Context...
Hello Council,
As comments roll in about the budget tonight, we wanted to provide context to the tax increases. Within the budget
book on page 9, we provide an estimate on the average impact to a property in the City of Meridian. The proposed
budget has 3% as its allowable option which we calculate on average to cost a property owner $.48 per month per
$100,000 of taxable value. Another way to say this is, if a house is valued at $468,000 ($343k taxable value after tax
exemption), then we project that house could see an impact of $1.68 per month for the decision of taking the 3%
allowable.
Disclosure – the year over year property value change of each property will have a HUGE impact on the final outcome
for each property. If a property had its value go down year over year along with our reduction of our levy rate, then the
property will see a savings in taxes. The data below is based on averages and with the law of averages, we always have
properties lower and higher. The property value will be the largest impact on final outcomes for each individual story.
As a reminder, we are projected to lower our Levy Rate year over year. In other words, if a house value did not change
year over year, then the property taxes paid would be lower.
1
Regarding the Forgone Impacts. The City is proposing to recover 1% of its balance. The financial impact of this decision
will have about a $.16 per month impact for every $100,000 of taxable value. Using the same taxable house value above,
this house would experience a monthly impact of $.54 per month.
In summary, the 3% Allowable and the Forgone would impact on average $2.22 per month. As a reminder, the house
valuation year over year will have a large impact on the result as our Levy Rate is being reduced year over year.
One final note regarding comments received – The City does collect Impact Fees from New growth and the City is very
successful in utilizing these Impact Fees. As a reminder, Impact Fees are one-time in nature revenue sources and can
only be used for one-time in nature expenditures (ie. Fire Stations, Parks, Apparatus). The City must obtain NEW on-
going revenues to pay for NEW on-going expenses (most likely Personnel costs for Fire and Police staff) to support the
New one-time in nature Impact costs. The primary revenue to pay for all New on-going expenses is Property Taxes (given
City’s proportionate shares of Liquor Revenue and State Sales Taxes have been minimalized over the past 3 years…and
HB389). The City Council added two new fire stations, SAFER Grant 18 staffing, PERSI increases, Wage Adjustments over
the past 24 months accounting for about $13m ($71m - $58m) in new on-going personnel expenses. The City discussed
this impact in previous years before finalizing the decisions and understood that we had this large increase in the future
(our current now) and that property tax increases were mandatory if we were to open two fire stations, add police staff,
accept the SAFER grant, and produce competitive wage adjustments.
2
I hope this information helps with any discussions.
Thank you for asking the questions and please let us know how we can assist with any communications.
Have a great day!
Todd
From: Jenny Fields <jfields@meridiancity.org>
Sent: Tuesday, August 20, 2024 10:31 AM
To: Brian Whitlock <bwhitlock@meridiancity.org>
Cc: Todd Lavoie <tlavoie@meridiancity.org>; Ricardo Ortiz Miller <rortizmiller@meridiancity.org>
Subject: RE: Context...
Hi Brian,
Your understanding is correct! The 3% allowable increase is calculated differently than of the 1% forgone value. Please
let us know if you need any additional information.
Thanks,
Jenny Fields, CGFM | Budget Manager
City of Meridian | Finance
Where Everyone COUNTS!
From: Brian Whitlock <bwhitlock@meridiancity.org>
Sent: Tuesday, August 20, 2024 10:26 AM
3
To: Jenny Fields <jfields@meridiancity.org>
Subject: Context...
Jenny -
I am just reading through the few public comments that Chris included for review prior to our budget
hearing.
One resident was opposed to a "4-percent tax increase."
Just so I am straight if/when I respond to that claim, there is a proposed 3-percent (limited by statute)
increase on the value of all property within the city. So, that's 3-percent of a big number.
To my understanding, the foregone is 1-percent of a much smaller number. It's 1-percent of the total amount
of what could have been collected up to the 3-percent cap - but wasn't.
It's not 1-percent of the total assessed value.
The 3-percent and the 1-percent are calculated differently - and don't add up to 4-percent.
Am I correct in that understanding?
Brian Whitlock
City Councilman, District #1
City of Meridian
33 E. Broadway Ave., Meridian, Idaho 83642
Phone: 208-850-3301
4