Lawrence city commissioners on Tuesday approved a maximum property tax rate for next year on a 4-1 vote. They also agreed to ask voters to approve a sales tax increase to fund Lawrence Transit.
This is a midpoint in the city’s budget process. After this vote, commissioners can vote to lower the property tax rate before they give the budget final approval in September, but they cannot increase their spending authority.
The maximum mill levy, or property tax rate, for 2027 is 36.060, up 2.35 mills from 33.712 this year. That includes increasing the property tax rate for the library to a maximum of 4.5 mills from 4.093.
If this mill levy is what commissioners ultimately approve, it would be the largest property tax rate increase for the city in at least five years.
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Mayor Brad Finkeldei, Vice Mayor Mike Courtney and Commissioners Mike Dever and Amber Sellers voted to approve the maximum mill levy; Commissioner Kristine Polian voted against it.
“As long as I’ve been on the commission, we’ve set the mill rate as proposed by the city manager, and I think in every year we’ve brought it down,” Finkeldei said.
Polian said she was not willing to approve a mill levy increase above the increase for the library, which is outside of the commission’s control.
What this property tax rate would look like
The median sale price of a home in Lawrence over the past two years was $325,000, according to a recently completed housing study. The owner of a home valued at $325,000 would have owed the city about $1,260 in property taxes this year.
If the approved new maximum is the rate included in the final budget, the property owner would owe the city about $1,348 in property taxes, an increase of $88, in 2027.
Home valuations have also increased 5% on average countywide, meaning even if the city’s property tax rate were to remain flat, most residents will be paying more next year.
Property owners also pay taxes to the county, school district and state. In Lawrence, property taxes break down to about 41% to Lawrence Public Schools, 32% to the county, 26% to the city and 1% to the state.
Commissioners voted unanimously to put a sales tax increase on voters’ Nov. 3 ballots. Lawrence voters have to approve any sales tax increases the city proposes in order for them to go into effect.
Lawrence Transit currently receives funding from a 0.2% sales tax, and city staff members want to increase it to 0.3%. City staff members’ proposed budget presumed that voters would approve an increase.
Transit buses have been fare-free since January 2023. Without an increase, current route frequency, fare-free bus rides and the long-planned downtown transit station could be in jeopardy, according to previous information provided to the commission.
“Returning fares to our transit system won’t replace our need for a sales tax. Fare-free or not, our budget will remain structurally unbalanced without this 0.1% increase,” Felice Lavergne, director of transit, told commissioners. “Continuing at our current 0.2% sales tax rate will result in significant cuts to transit service when we renew our operations contract in 2029. Without any sales tax, transit as we see it today wouldn’t exist.”
The sales tax currently costs 4 cents per $20 spent in the city, or 20 cents per $100 spent. If voters were to approve, that would increase to 6 cents per $20, or 30 cents per $100 spent.
The commission will hold more budget discussions over the next few meetings, and community members will have more opportunities to comment on the budget and property tax rate.
City commissioners will hold their formal public budget hearing on Sept. 1. They’ll consider final adoption of the budget during their Sept. 15 meeting.
See previous coverage of the city’s budget process at this link and in the links below.
Douglas County commissioners will meet for their final day of budget deliberations at 9 a.m. Wednesday, July 15. They will consider setting their maximum property tax rate during their business meeting, set to begin at 5:30 p.m. at the historic courthouse, 1100 Massachusetts St. See their meeting agenda at this link; join the meeting on Zoom via this link.
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Mackenzie Clark (she/her), reporter/founder of The Lawrence Times, can be reached at [email protected]. Read more of her work for the Times here. Check out her staff bio here.
Lawrence city budget coverage
Nathan Kramer / Lawrence Times
Nathan Kramer / Lawrence TimesLawrence city commissioners OK maximum budget, will ask voters to hike transit sales tax
Jacob Rice / Lawrence Times
