Fairfield Ledger

Mt. Pleasant News   Wash Journal
Neighbors Growing Together | Nov 20, 2017

Fairfield lowers tax levy, raises utility rates

tax levy falls 1.2 percent, water to rise 3 percent and sewer to rise by 5
By Andy Hallman, Ledger news editor | Feb 28, 2017

The Fairfield City Council passed a budget Monday that lowers both taxes and expenditures for next fiscal year.

The council lowered the city levy from $16.15 per $1,000 of assessed valuation to $15.92. Single-family residences in Iowa are taxed at about 56.9 percent of their value. A Fairfield resident with a home valued at $100,000 would therefore owe $906 in property taxes to the city.

City Administrator Mike Harmon said the 2017-18 budget will see expenditures in the general fund drop 1.8 percent to $4 million, and revenues drop 1.5 percent to about $4 million as well.

“A large part of those savings came from refinancing outstanding debt, and from conservative budgets submitted by our department heads,” he said.

The city refinanced $6 million of its debt in 2016 after receiving an A bond rating from Standard & Poor’s. With the new rating, the city was able to lower its interest rate from 4 percent to 1.7 percent, which translates into $265,000 in savings over a six-year period.

Harmon said the city did not include “backfill” from the state government in preparing the 2017-18 budget. Since local taxing entities cannot tax the full value of property in their jurisdictions, the state government has typically reimbursed cities and counties for the loss in revenue with money known as “backfill.”

However, Harmon said city staff were unsure if the state would come through with backfill, so they left it out.

Harmon said the noteworthy changes to the general fund are:

• Pay increase of 1.5 percent for city staff;

• A 7.83 percent rise in the cost of health insurance;

• Planned improvements to the Chautauqua Park entrance costing about $42,000; and

• Reduction in the city’s debt levy due to refinancing outstanding debt.

The council approved the third reading of a pair of ordinances to raise water and sewer rates. Water rates will rise 3 percent each year for five years, while sewer rates will rise 5 percent this year and next year, after which it would increase 1.75 percent per year to keep pace with inflation.

The additional revenue should allow the water and wastewater departments to pay for ongoing improvements. Harmon identified a few of the main expenses in those two departments:

• Libertyville Road sanitary sewer line;

• Construction of STEP 1 sanitary sewer conveyance;

• Land acquisition for STEP 2;

• Wastewater treatment plant improvements;

• Sanitary sewer lining projects; and

• Water main repairs.

In a letter to the council, Harmon detailed a few street projects the city has planned for next fiscal year, which are included in the 2017-18 budget. They include an overlay of asphalt on seal coat streets such as:

• Park Street, from Hillcrest to Madison;

• Maple Street, from Fillmore to Buchanan; and

• Polk Street, from Second to Third.

Additional improvements include the reconstruction of Adams Street from Maple to D Street and reconstructing the east-west alley from Court Street to Main Street.

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