Archive for Tuesday, February 27, 2018

Editorial: City’s financial mistakes pile up

A recent blunder on the affordable housing front is the latest in a series; taxpayers deserve better.

February 27, 2018

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It is difficult to have much faith in the city of Lawrence’s financial decision-making these days.

The city that failed to bill tenants for property leases for years and failed to properly invest funds it received for the cleanup of the Farmland Industries property can add botching the rules for funding affordable housing projects to its list of mistakes.

It appears the latest misstep will cost Lawrence taxpayers modest property tax relief.

Last fall, the city awarded $600,000 in funding for affordable housing projects. The plan was to finance the projects and repay the debt using funds from a sales tax for affordable housing that was approved by voters in November and will take effect in 2019. But the city’s bond counsel recently said those housing projects did not meet bond requirements that the projects contribute to economic development.

Given the ruling, the city must find $600,000 in cash to pay for the projects. Of course, it just so happens that the city has about $630,000 in unbudgeted revenue from one of its other miscues: The outstanding rent payments from leases the city failed to bill for years until discovering the error last year.

For 2018, the city implemented a 1.25 mill property tax increase, mostly to pay for a new police headquarters. Based on that, city officials had indicated that perhaps the $630,000 in back lease payments should be returned to taxpayers in the form of a property tax break. Former Commissioner Mike Amyx and City Manager Tom Markus were supportive of the idea.

But last week, commissioners started walking back the tax break idea, indicating the $630,000 in lease payments will have to be used for the affordable housing projects instead.

“Anytime we get an opportunity to provide some property tax relief where the money is truly available, then obviously that’s something that should be looked at really hard,” Commissioner Lisa Larsen said. “Should it be returned to the public? Maybe so. But I don’t think I want to tie my vote to any one thing until we’ve heard every single option.”

The $630,000 property tax break spread across the tax base would not have amounted to much for city taxpayers. Still, it’s disappointing that city commissioners are ready to forego a break for taxpayers in order to cover their affordable housing mistake.

Missteps are to be expected from time to time, but the city of Lawrence has stumbled far too often in the past year. It’s long past time for the stumbles to end.

Comments

David Reynolds 1 month, 3 weeks ago

Combine the above with city staff's failure to attached tax liens for properties with delinquent property taxes, and we see the magnitude of staff operational concerns. Additionally, we would not have lost those tax revenues. Also we would not be wasting city hall staff & commission time by trying to create an unnecessary ordinance to solve an internal procedural problem. And most importantly, city hall would find it unnecessary to denigrate an entity that is actually performing economic development by increasing the tax base for the city of Lawrence. (A separate discussion can be held regarding why some of those vacant lands had delinquent taxes)

This morning I heard Mayor Boley, on the radio, talking about how great the financial staff was by creatively refinancing some bonds. Kudos for for that bit of creativity.

Now, if city hall management & staff can just apply the same level of creativity to internal procedural problems, we won't have to have these types of discussions in the future.

Bob Summers 1 month, 3 weeks ago

Just raise property taxes to make up for the people in government financial mistakes and incompetence.

Steve King 1 month, 3 weeks ago

The conservative condition in real life. Shrink government where you can drown it in a bathtub. Cut Staffing services to the Bone. 1 person doing 3 peoples work load.Tax cuts for the elites. Trickel down. Deficit spending. Unfunded pensions. Highway Funds siphoned off. Social Services cuts. Education cuts. Health Care Cuts. Rest areas bulldozed. State return 1/2 of the liquor tax to the cities stopped. Sad.

Now Nationally, a $1.5 Trillion tax cut. And the Treasury is now saying they need to increase the Debt Limit earlier than expected. And the House, announces a need to Cut SS and Medicare/Medicaid because, they have a $1.5 Trillion deficit.

Sad.

Michael Kort 1 month, 2 weeks ago

and the media is oblivious to the reality of the Trump Infrastructure Plan that is supposed to cost $ 1,500,000,000,000 ( 1.5 $ Trillion Dollars ) of which Trump expects States, Cities, etc., I.E......the taxpayers to come up with out of their tax cuts to make it work a small sum of.......13 / 15Ths of its' cost or $ 1,300,000,000,000 ( 1.3 $ Trillion Dollars ) which works out to about $ 3,800 per every living American ( and of course interest )......( but, not that every living American pays taxes ), so it is more like $ 7,600 plus interest ?.........and then to fix our highways ( which do need fixing ) Trump wants an additional 25 cent per gallon of gasoline tax..........all of which was deceivingly sprung onto the public after Trump got his tax cuts for the wealthiest ( whomever ) done .

Con.....servative.....they just lie. run adds, play the media coverage and run shell games on fools and rubes

Richard Heckler 1 month, 3 weeks ago

How can the city continue to approve tax abatements etc etc etc?

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