New budget law requires a special hearing

Local government entities, such as city councils, county commissions and school boards, will be required to hold a special public hearing this year if their proposed budgets plan to collect additional property taxes, according to a new state law.

This past spring, the Kansas Legislature and Gov. Laura Kelly approved Senate Bill 13, which repeals the previous property tax lid on yearly mill levy increases.

Instead of a tax lid, the bill establishes a “revenue-neutral rate” (RNR) that each taxing entity must now base their budgets on. 

This rate is determined by taking the actual amount of taxes levied for last year’s budget divided by this year’s assessed value.

If a city, county or school district experienced an increase in assessed valuation this past year, then the governing entity must lower its mill levy rate in order to be “revenue neutral,” according to the bill and not increase the amount of new taxes to be generated. 

The bill passed the House on a 120-3 vote. Rep. Francis Awerkamp and Rep. Randy Garber, who represent Jackson County, both voted against the bill. The bill then passed the Senate on a 30-5 vote with local Sen. Dennis Pyle voting in favor of the bill. 

“I argued against it in committee,” Rep. Awerkamp said at a Legislative forum in Wamego this past spring. “I attempted several amendments, and I was one of three people who voted against it. The timeline is impossible, and it’s an added burden cost wise to the counties.”

Proponents of the bill say it creates more transparency during the budget process.

Jackson County and all three Jackson County school districts, as well as the city of Holton and several other cities, have experienced an increase in assessed valuation this past year.

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