Lawrence City Commission to consider options for nearly $700,000 in recouped payments

Lawrence City Hall, 6 E. Sixth St., is pictured on May 3, 2016.

At their meeting Tuesday, Lawrence city commissioners will decide whether they will return hundreds of thousands of dollars in recouped payments to city taxpayers.

City staff is recommending the money be used to pay for the an audit of the city’s accounts receivable, to purchase better accounting software, and to offset future property tax increases, according to a memo from staff to the commission.

Pay for the audit: The city ordered the $49,000 audit last year after owners of the Riverfront Plaza asked for an account summary, and it was found land lease payments of about $250,000 had been neither billed or paid for several years. The city subsequently hired the auditing firm RSM to review its miscellaneous payments, resulting in the discovery of additional missing payments totaling about $690,000.

New accounting software: Last month, commissioners received the final report from RSM related to the missing payments, which includes recommendations for how the city can improve its billing process. One of those recommendations is that the city improve automation of its miscellaneous billing and billing audits, which it has limited capacity to do with its current software.

Offset future property tax increases: City staff recommends that property taxes in future years be offset by using part of the money to fund $600,000 in affordable housing projects previously identified to be debt financed. By issuing less debt, the city could avoid interest expenses of approximately $65,000 over the next five years, reducing the property tax mill rate in the Bond and Interest Fund by 0.13 mills during that time, according to the memo.

The idea of returning the recouped money to taxpayers was brought up by former Commissioner Mike Amyx last month. Lawrence residents will see a city property tax increase of 1.25 mills for 2018, costing the owner of a $175,000 home an additional $25 annually in city property taxes. The commission also approved an increase in utility rates that will cost the average resident another $65 annually.

In other business, the commission will consider awarding $600,0000 in city funds to affordable housing projects for 2017 and 2018. The city’s Affordable Housing Advisory Board is recommending the city provide $30,000 to Tenants to Homeowners, $75,000 to Lawrence Habitat for Humanity, and $495,000 to Bert Nash for a mental health facility that includes temporary housing. The commission will also consider increasing the number of board members from nine to 12.

The City Commission will convene at 4:30 p.m. Tuesday at City Hall, 6 E. Sixth St.