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Lancaster County proposes lowering tax rate in light of higher property valuations, effects of pandemic
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Lancaster County proposes lowering tax rate in light of higher property valuations, effects of pandemic

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South 68th Street

Traffic flows north into Hickman on South 68th Street in 2019. 

County budget

There’s never been a budget year like this one.

Not one, at least, that Lancaster County Budget Director Dennis Meyer can remember.

An influx of federal pandemic aid, a large carry-over of money from this year’s budget and a total revaluation of property in the county means Lancaster County has significantly more money in the coffers.

“I’ve been here 13-14 years and I’ve never seen anything like it,” Meyer said. “It’s nothing we’ve ever dealt with before.”

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Even though the bulk of that money won't be used in the $128.5 million general fund budget, which is supported by property taxes, the county still plans to lower the tax levy it's responsible for by 1 cent per $100 of valuation.

The general fund budget will increase by about $5.1 million (about 4%) and the biggest increases include $3.6 million to the county engineer — including setting aside $1 million to widen South 68th Street, a project that would begin next year; hiring an additional sheriff's deputy and adding a lawyer for both the public defender's and the county attorney's offices.

But the biggest chunk of money coming to the county won't feed the general fund budget: $62 million the county will get from the latest coronavirus stimulus package.

Of the money received so far, $20 million will go into the county’s overall budget. That gives the county the authority to spend the money yet this year if needed. The relief aid can be spent over several years, so the remainder will go into a separate account until officials decide how they want to use it. The federal government has some stipulations about how the money can be spent, and because it's a one-time payment, it isn't likely to be used on recurring costs.

County Board member Sean Flowerday said the county is working with the city — which will receive $46 million in aid from the same federal relief act — to decide how best to use the funds.

The idea, he said, is to earmark the money so that the city and county aren’t duplicating their efforts and can, by working together, supplement more services.

The county, he said, is focusing on human services, including bolstering mental health and youth crisis services; tourism; community corrections; expanding rural broadband; and improving the rural water supply.

For instance, the county plans to spend $1.6 million to help make up for a 60% loss in lodging tax revenues during the pandemic, when very few people were traveling and staying in hotels.

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The other sources of additional revenue will be part of the general fund: $18.2 million in carry-over money from last year's budget, which is $8.2 million more than last year, primarily because the county spent less on services, such as county and district courts, which essentially shut down during the pandemic.

Of that additional $8.2 million, the county plans to use $6.5 million to bolster the cash reserve, Meyer said. The cash reserve — which would increase to $16.5 million — also falls outside the general fund budget.

Increasing the cash reserve helps with cash flow during the year and leaves a buffer so, if necessary, the county can borrow from the fund for emergencies such as flooding, Meyer said.

Also, county officials are expecting an additional $2.6 million in property tax revenue, thanks to an estimated increase of about 10% in the county’s property valuations.

That increase factors in a lower tax rate.

The county proposes lowering the tax rate by 1.75 cents and shifting three-quarters of a cent of the levy to the Railroad Transportation Safety District to help raise revenue to pay for long-discussed improvements at 33rd and Cornhusker Highway. The ambitious $100 million project involves building a bridge over the railroad tracks near Cornhusker Highway and rerouting a portion of 33rd and Adams streets.

The county board sets the railroad transportation district’s levy, and has "borrowed" the levy in recent years to help pay for county services. It agreed to pay back a portion of the levy this year and next year.

The proposed budget would lower the county’s property tax levy from 28.1576 cents per $100 of property valuation to 26.4076 cents. The railroad transportation district's levy would increase from 1.4717 cents to 2.2217 cents.

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Annually, Lancaster County comprises about 13% of a city property owner’s tax statement. The city’s budget comprises slightly more and Lincoln Public Schools comprises the lion’s share at about 61%.

The owner of an average home valued at $201,600 would pay about $577 in taxes for Lancaster County and railroad transportation district services. Assuming the value of that property owner’s home remained the same as last year — unlikely given the rise in property values — taxes paid to the county and RTSD would be down about $20 from last year.

The county will hold a public hearing on the budget sometime in August.

Levy increase requested to help pay for railroad overpass project at 33rd and Cornhusker

Reach the writer at 402-473-7226 or mreist@journalstar.com.

On Twitter @LJSreist

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Local government reporter

Margaret Reist is a Lincoln native, the mom of three high school graduates now navigating college and an education junkie who covers students, teachers and policymakers inside and outside the K-12 classroom.

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