City’s tax asking continues to drop

Proposed tax rate marks third straight year of decline

For the third straight year, the property tax asking within the City of Clear Lake will drop.

City Administrator Scott Flory delivered the first of three presentations about the proposed 2019 fiscal year city budget during the regular City Council meeting Monday night, Feb. 5.  The proposed tax rate is $9.70 per $1,000 of taxable valuation.

Flory pointed out that for fiscal year 2017 the city’s tax rate decreased from 410.54 to $10.04; for fiscal year 2018 the rate was cut to $9.80; the fiscal year 2019 rate, which begins on July 1, 2018 and ends June 30, 2019, goes down 10-cents more, to $9.70.

“The City’s tax rate, therefore, has decreased by nearly 85-cents per $1,000 of taxable valuation over the last three years,” he noted.

The city’s tax rate continues to be among the most enviable in the state, ranking it fourth lowest among Iowa cities with a population over 4,000.  Using the proposed rate would mean the city would have only 3.7 percent of its debt capacity used.

“Anything under 5 percent of debt is basically no debt and is practically unheard of in the country,” said Flory.  “We pay cash as we go and that results in very little debt.  That’s rare company to be in.”

Flory’s presentation, which will be repeated at the Feb. 19 meeting and again at a public hearing March 5, pointed out Clear Lake’s low tax rate are a major reason for businesses to consider locating here.

For example, Flory noted Clear Lake’s tax rate is approximately $4.10 per $1,000 of taxable valuation less than neighboring Mason City.  Using the McKesson Corporation, which located in Clear Lake in 2016, as an example, Flory said the pharmaceutical distributor pays $70,000 less annually in city taxes to be here, rather than Mason City.  Figuring the same scenario with rates from all taxing entities (school, city, NIACC, county and sanitary district), the consolidated tax rate for Clear Lake is $28.29 per $1,000, while Mason City comes in at $35.62.  Those numbers mean McKesson saves $117,000 annually by doing business here.

Although the city’s tax asking keeps dropping, Mayor Nelson Crabb and Councilmembers joined Flory in noting the city’s tax asking is basely one-third of the overall tax bill residents will receive.

The Clear Lake School District receives about 37 percent of the consolidated tax asking, while the city is approximately 35 percent, county is 24 percent, and NIACC and sanitary district about 2 percent each.

Clear Lake’s taxable valuation for the 2019 fiscal year continues the positive trend of growth in the community, according to Flory.  The taxable valuation is $607,348,889, which is a $21,052,154 increase (3.6 percent) from fiscal year 2018.

The proposed 2019 budget reflects total expenditures among the various programs of slightly over $13.5 million, of which $8.3 million is directed toward operations and maintenance; $4.7 million toward capital; and $500,000 to debt service.

Veterans Memorial Golf Course

In other business Monday night, the Council heard an annual report provided by Tom Fey, president of the Veterans Memorial Golf Club board.  Fey said gross revenue for the city-owned

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course was $351,000 last year, approximately $2,000 more than the previous year.  Expenses were also nearly the same.

“We operate on a very tight budget and had a net income of $34,000,” stated Fey, adding his appreciation for the volunteers and board members which have helped the non-profit foundation which oversees the course, continue to make improvements.  “I have been a member of the course for 30 years and I have never seen it in better shape,” added Fey, congratulating Course Superintendent Jeremy Amosson and Director of Golf Michael Oimoen.

Fey said that last season the course had 192 season-pass holders and 59 friends, which was down slightly from the previous year.  So far, 56 golfers have pre-paid for the 2018 golf season, with another 14 making partial payment.  The women’s league has been a bright spot at Veterans Memorial, with numbers growing from the 30s to 70 and even 80 participants.

StoneCliff Subdivision

The City Council gave its approval to the proposed StoneCliff 3rd Subdivision, located on the south edge of the city.  The 23-lot third phase is zoned medium density single family residential and is 16.4 acres.  The final plat was approved by the Planning and Zoning Commission in January.  Developers of the subdivision are Bill Yohn and Al Miller.

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