photo by: Mike Yoder

Lawrence City Hall, 6 E. Sixth St., is pictured Thursday, July 7, 2016.

To meet requirements of a new state law, Lawrence city leaders will soon consider whether to take the first step toward a 2022 budget that, though it would not increase the city property tax rate, would result in residents paying more in taxes than they did last year.

As part of its meeting Tuesday, the Lawrence City Commission will consider setting a date for a newly required public hearing for exceeding the “revenue-neutral” rate. Though City Manager Craig Owens’ recommended budget calls for the city’s property tax rate to remain flat, the city’s property tax collections would still increase under the proposal because the county’s property tax valuations have increased.

The Kansas Legislature passed the new law in March. It requires governing bodies to notify their taxpayers and have a public hearing if city leaders are going to consider a budget with a property tax rate increase or a flat property tax rate that results in property owners paying more in taxes because of an increase in assessed property value. Supporters said it would force local officials to be more open in making tax and and budget decisions, as The Associated Press reported.

Under the law, Senate Bill 13, governing bodies must hold a public hearing on the intent to exceed the revenue-neutral rate. Once the city notifies the county clerk of the intention to consider exceeding the rate, which must be done on or before July 20, the mill levy rate can be reduced but cannot be increased, according to a city staff memo to the commission. When the public hearing is held, local leaders must publicly vote on whether to exceed the rate.

The city’s current property tax rate is 33.318 mills, and because of the increased property tax valuation, the rate would have to be reduced to 32.515 mills to be budget neutral, according to the memo. The approximately .8 mill difference in the rate would adjust for the approximately $937,000 in additional tax payments the city would receive under a flat rate due to increased property assessments.

City staff is recommending that the commission keep the property tax rate flat and that the commission hold the public budget hearing and the hearing about the intent to exceed the revenue-neutral rate on Aug. 31.

The recommended budget is $383.87 million across all funds and calls for an increase in all three city utility rates. It includes a new division to address homelessness; more than $117 million in infrastructure and maintenance funding; $5 million total in pay raises for both union on non-union employees; and eight new staff positions, four of which are funded at least initially by federal or state grants. The budget also begins to allocate the approximately $19 million in federal coronavirus relief the city will receive from the American Rescue Plan Act.

The Lawrence City Commission will meet at 5:45 p.m. on Tuesday at City Hall, 6 E. Sixth St. Residents who want to provide public comment can do so in person at City Hall, in writing or virtually via Zoom, and more information about those options is available on the city’s website, lawrenceks.org.

Correction: A previous version of this article misstated the total amount allocated toward employee raises.