Lawrence city commissioners appeared to agree Tuesday that they want to explore all options that would avoid the need to raise property taxes next year.

“A mill levy increase is something I definitely do not want to do,” Commissioner Leslie Soden said during a two-hour study session to review the 2016 budget proposal.

Tuesday’s study session was the first opportunity commissioners had to delve into the details of the proposed budget since interim city manager Diane Stoddard unveiled it last week.

It calls for raising the city’s property tax rate by a little more than 3 percent, or 1.057 mills, which translates to $19.45 in additional tax on a home valued at $160,000.

That would bring the city’s total property tax rate to 32.531 mills, or $598.57 in tax on a $160,000 home. That does not include the taxes that property owners pay to school districts, Douglas County, the state of Kansas and other local units of government.

Stoddard said the city has made significant investments in recent years, with projects such as Rock Chalk Park, a new technical education training center, expansion of the Lawrence Public Library and the Bioscience and Technology Business Center at Kansas University.

In addition, she said, completion of the South Lawrence Trafficway and the new interchange at Bob Billings Parkway and Kansas Highway 10 are expected to generate new economic activity.

She said the proposed budget for 2016 focuses on maintaining the existing level of service and providing pay raises to city employees.

The proposed budget also calls for restoring about $350,000 a year to help fund social and mental health employee positions in the Lawrence school district, a program that the city stopped funding in 2008.

But several commissioners suggested that some expenses being paid out of the city’s general fund, which comes mainly from property and sales taxes, could be paid instead out of other special revenue funds, thus freeing up general fund money and possibly avoiding the need for a tax increase.

Commissioner Stuart Boley, for example, noted that the city is using sales tax revenues to pay for operations and to make the debt service payments on the Lawrence Sports Pavilion, the city’s portion of Rock Chalk Park. He suggested that at least some of those costs could be paid with revenues from the city’s transient guest tax.

“The Lawrence Sports Pavilion Lawrence and Rock Chalk Park were sold as promoting Lawrence,” Boley said. “I think it’s totally appropriate to use guest tax money for some of those expenses.”

Commissioner Matthew Herbert noted that some of the city’s special revenue funds carry over large cash reserves from year to year, and he suggested spending down those reserves before asking residents to pay higher property taxes.

“Philosophically, this goes beyond the 2016 budget,” he said, suggesting that city staff should come up with a new method of determining how much of a reserve balance is appropriate for various funds.

Since last year, Lawrence has seen an estimated 2.4 percent increase in assessed property values, the basis on which property taxes are calculated. And officials are expecting to see about 3 percent growth in sales tax revenues.

Mayor Jeremy Farmer said that’s barely enough to keep up with rising costs, including mandated increases in the city’s contributions to employees’ retirement funds.

In addition, he said, what is especially worrisome for city officials is a state-imposed property tax lid, which lawmakers approved earlier this year. Under that lid, starting in 2018, cities and counties would have to seek voter approval before they could increase property tax revenues by more than the rate of inflation.

“So in two years, in order for us to deal with that, we would actually have to cut a significant amount of money or have a public vote for very non-sexy things like paying salaries,” Farmer said.

Commissioners will continue discussing the budget during work sessions and public business meetings. They are expected to vote on a final budget in late July or early August.