Drop in valuation totals makes budget process challenging

This week’s news regarding combined property values in Hamilton County sends a jolting message to local officials in charge of setting tax levies: Spending must come down.
A front page story in this week’s edition reports that a decline in ag land values was the primary factor in a $167 million valuation drop. Though the crops in the field look outstanding right now, the reality is that low commodity prices and a sluggish ag sector are rippling their way throughout the local economy.
Total valuation in Hamilton County dropped 5.24 percent in 2017, ending a 10-year run which saw property values skyrocket from $1.09 billion in 2007 to $3.2 billion just a decade later. We knew this day was coming as that pace is simply not sustainable.
Budget decisions will be especially difficult in Aurora, where a $42 million reduction in personal property values placed on the local ethanol plants will have an impact on available revenues. Our community is very fortunate to have not one but two ethanol plants running full steam ahead, as the total investment out at Aurora West and the premiums they provide to area producers are both significant.
Nonetheless, the numbers are what they are this year, which means local taxing entities will have to sharpen the pencil to make ends meet without adding to the tax burden.
Complicating this scenario is the fact that a high percentage of budgets, private or public, go toward payroll, which unfortunately means this is one year when pay raises beyond cost-of-living adjustments should be anything but automatic. Businesses large and small face gut-wrenching decisions regarding wage freezes and staff reductions from time to time. It’s not always about the quality of work, longevity of staff or what the competition or array of like-size entities is paying. When times are tough it boils down to fiscal responsibility and keeping the ship afloat.
Hamilton County taxpayers, particularly farmers, have a vested interest in a process about to unfold as area taxing entities set their levies and determine tax asking for the coming year. No one is fooled by the focus on tax levies. Trying to soften the blow saying a particular board is doing its job by holding the line at or slightly below last year’s levy simply doesn’t mean anything. In reality, the levy doesn’t determine our tax load, actual tax asking does.
Local boards must be diligent in their efforts to trim spending whenever and whereever possible.
Kurt Johnson

Rate this article: 
No votes yet