Sedgwick County commissioners voted Wednesday to limit their ability to borrow and set a goal of flat property tax rates for the next six years.
In a decision reminiscent of last year’s budget fight, commissioners voted 3-2 to lower how much debt can be included in the county budget.
They voted unanimously to try to keep a level mill levy rate for the next six county budgets. That rate, which determines property tax payments, would be lowered in 2023.
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The County Commission lowered how much of the county budget can be spent on paying back debt.
Spending interest unnecessarily is a waste of taxpayer dollars. We have borrowed money at some times unnecessarily, particularly with roads and bridges.
Commissioner Richard Ranzau
The county used to have a target debt ceiling of 20 percent, meaning it couldn’t spend more than 20 percent of its budget on paying back debt.
The ceiling now will be 9 percent. It will be lowered to 8 percent in 2019.
The county’s current debt makes up about 9.6 percent of county expenses.
Sedgwick County won’t borrow for projects until the county’s debt payments drop below 9 percent of the budget, which should happen in 2017.
This is not being generated by some sort of crisis or any sort of need to change anything we’re doing. Since we have been very judicious in our use of debt … I don’t see how this is a real issue other than a declaration.
Commissioner Dave Unruh
“In that year, we would have the ability to issue as much as $7.6 million of new debt,” said Chief Financial Officer Chris Chronis.
The county’s debt policy sets guidelines for how the county pays for capital projects like roads and bridges.
That was a contentious issue in crafting this year’s budget.
The County Commission voted to stop paying for regular road and bridge maintenance with debt, which the county used to do by issuing bonds. It created a cash reserve instead.
Familiar battle lines
Some commissioners touted the change as being more fiscally responsible.
“Spending interest unnecessarily is a waste of taxpayer dollars,” said Commissioner Richard Ranzau. “We have borrowed money at some times unnecessarily, particularly with roads and bridges.”
Others said it limited the county’s options and led to cuts in public health, recreation and economic development.
“We’ve taken it too far,” said Commissioner Tim Norton. “And if we keep moving that way, we’re going to hamstring ourselves with the fluidity that we might need in the future.”
We’ve taken it too far. And if we keep moving that way, we’re going to hamstring ourselves.
Commissioner Tim Norton
Commissioner Dave Unruh questioned the point of an action that could be reversed by future commissions.
“This is not being generated by some sort of crisis or any sort of need to change anything we’re doing,” Unruh said. “Since we have been very judicious in our use of debt … I don’t see how this is a real issue other than a declaration.”
The mill levy rate determines how much property tax revenue Sedgwick County residents pay.
The commission voted Wednesday to set a target mill levy rate of 29.359 mills. That’s slightly lower than the current 29.383 mills.
“This is a game-changer. This is transformation,” Ranzau said. “This is the result of a lot of work we did last year and we’re continuing to do.”
29.383 current mill levy
29.359 target mill levy for 2017 to 2022
28.758 target mill levy for 2023
The goal is to keep the rate the same from 2017 to 2022, then have it drop to 28.758 mills in 2023. That’s the lowest since the 2006 budget was approved.
Sedgwick County set a lower mill levy than all but two other counties in the state for this year, according to the 2016 budget.
But commissioners on the board’s majority don’t like how property tax rates can creep up if property valuations change after budgets are set.
“Many municipalities allow their mill levy to go up incrementally over time and still say they never voted for a mill levy increase,” Ranzau said. “(This change) makes a commitment to the taxpayers that we will control the rate of the mill levy.”
Getting the message out
After the votes, the county communications office published a statement and video online.
“Commissioners have proven that they are listening to their constituents and keeping government spending under control,” the statement said.
I’m proud of Sedgwick County for doing that. This is exactly what we should be doing, what people want us to do, and this is going to be good for our county.
Chairman Jim Howell, in a video recorded before the vote
The video, published before the meeting had ended, includes prerecorded statements from Ranzau and chairman Jim Howell.
“Hopefully, these types of responsible policies will last long into the future,” Howell said. “I’m proud of Sedgwick County for doing that. This is exactly what we should be doing, what people want us to do, and this is going to be good for our county.”