WATERLOO — Waterloo property tax collections could increase by nearly $3 million compared with last fiscal year, the City Council decided Monday.
The added collections were approved as the max levy, or the highest amount the city could approve for property tax collections to the general fund. City officials can vote to formally approve a lower property tax levy. The current max levy is a more than 8% increase from last fiscal year, resulting in nearly $38.3 million in total property tax collections.
Council member Margaret Klein was the only official to vote against the max levy. When the City Council considered a $13.7 million added TIF district Monday, Klein said she worried that higher tax rates could hurt residential property owners.
Michelle Weidner, city chief financial officer, said she does not believe the more than 8% hike will be approved as the final increase. She said she developed the max levy projection by talking with city departments to understand the money needed to maintain their services.
She said the city will have to consider employee health insurance costs and salary increases, which can be outlined in contracts or negotiated. The city entered closed session Monday to confidentially discuss those negotiations.
The council set March 25 as the final budget hearing, which would include finalizing property tax rates. Council members said they plan to have a budget work session next Monday.
Weidner said keeping the city’s current property tax levy would force Waterloo to cut about $4 million from its budget. That could include slashes to personnel in emergency services, such as police and fire employees.
“We’re going to have to make some tough decisions right now,” Waterloo Mayor Quentin Hart said. “It’s a tough year for everybody across the board.”
Waterloo is required to certify its entire budget by March 31 or risk getting its property taxes set at the same amount as the current year. Weidner said Monday that staying at the same property tax rate would be “devastating” for the city’s budget.