City of Lawrence Proposes Largest Property Tax Rate Increase in 50 Years to Build Reserves

Lawrence city commissioners are facing a decision on whether to approve the city’s largest property tax rate increase in at least 50 years. The proposed increase is intended to fund various projects and initiatives, but a review of the budget reveals that the majority of the funds generated would be used to bolster the city’s reserve account.

City Manager Craig Owens has recommended increasing the city’s general fund balance account by $3.44 million in 2025. This increase would be funded by a property tax rate increase of 3.5 mills, with nearly 65% of the additional revenue going towards the reserve account. Owens argues that rebuilding the fund balance account is essential for protecting against unforeseen events and economic downturns.

However, critics question the need for such a significant increase in the reserve account, especially when other areas of the budget are facing cuts. The proposed budget includes $660,000 in cuts to the Parks and Recreation department, despite the department’s special recreation fund having excess reserves that could potentially alleviate the cuts.

Additionally, the review of the budget raises questions about the city’s fund balance policies and whether certain accounts are in violation of those policies. Owens maintains that the excess funds in some accounts are not truly uncommitted and are earmarked for future projects.

City officials are also preparing a $4 million emergency budget plan for 2024 to address lower-than-expected sales tax collections. The plan is expected to include spending cuts and potentially dipping into fund balance accounts, like the special recreation fund.

Ultimately, city commissioners will have to decide whether to approve the property tax rate increase and the allocation of funds to the reserve account. The debate over the budget is expected to continue through late August before final approval is given.