L&T Publisher Earl Watt
The Kansas Senate was a raucous chamber in January when the debate opened up about one of the top issues on the minds of Kansans — property taxes.
While Senate Tax Committee Chair Caryn Tyson didn’t think it was the right time to discuss the issue, she said her chamber and the people of Kansas had made a push that made it impossible to ignore.
Instead, the Kansas Legislature calmed the storm of Kansans concerned about both valuation and mill levy increases despite a proposed 3 percent valuation cap form one year to the next being proposed.
And the issue focused more on tweaking the Revenue Neutral Rate reporting.
But with the massive request for new taxes coming from Seward County, once considered one of the most conservative counties in Kansas, there will certainly be more cries in the Kansas Senate and House to revisit limitations when the lawmakers convene in January 2026.
It’s unfortunate.
The numbers provided by Seward County on the Revenue Neutral Rate statement are fiction.
They know it.
I doubt the commission ever had any intentions of increasing the mill levy from 43 mills to 69 mills. But they believed they had to present a “worst case scenario” just in case.
They easily could have said 100 mills. It was never going to happen and never will.
A more realistic number would appear to be somewhere around 10 mills give or take a mill or two.
Even still, that is quite a leap, and that’s why there will be calls in the Kansas Legislature to revisit capping tax increases from year to year.
And that potential 10-ish mill number doesn’t include the proposed $2.5 million that would come from an additional half cent sales tax.
The sad part is the misdirected anger in the public being aimed at city road improvements, city park care and even the Ruby Red Slipper slide.
These had nothing to do with the proposal from the county but are taking shrapnel from what I believe to be an irresponsible request that should have never been made public.
With such an outlandish request for a number no one expected to be real, the angst spread to any and every taxing entity.
Maybe that was the goal. I certainly hope it was not.
It was also mentioned that the county had to defend against the appeal case while the other taxing entities did not have to contribute to the defense.
That is a true statement. But the other entities also do not have statutory authority to set the rates in the first place. That ability solely rests with the county.
Seward County Appraiser Angela Eichman, like the other 104 appraisers in counties in Kansas, could not independently establish a value on such a complex property like the ethanol plant.
Very few people in Kansas would be qualified to do it, if any.
More than likely all those qualified to value the plant came from somewhere else, both for Seward County and for the ethanol plant ownership.
Bringing in an expert was the right thing to do, and even still, it comes as no surprise that the number seemed to be considerably high given the position that the outside appraiser took at considering all equipment real rather than personal. Real is taxed, personal isn’t.
When the value was established at $91 million, I’m sure that turned a few heads at Arkalon Ethanol, and it naturally appealed the valuation.
The final value has yet to be set as the appeals process continues, but we know for sure that the number will be reduced to at least $62 million, which is the number the Board of Tax Appeals determined. Arkalon Energy believes the number should be around $29 million.
Why can one case in Seward County lead the Kansas Legislature to reconsider tax caps?
First, there is a natural tug of war between state and local units of government. Many people run for the Legislature to reduce the tax burden on the people, and they realize that local taxing authority can greatly affect Kansans, and they have no way to control it.
One way would be to cap the amount of taxes that can be levied in any given year.
Commissioner Tammy Sutherland-Abbott stated at the recent town hall that the problem rests with the previous commissioners who failed to put the money aside.
There is truth to that, and that also plays into the distrust the Legislature has of the ability of local units of government to properly handle finances.
But the problem now isn’t just decisions made in the past. Had previous commissioners not used those funds, they would have left a greater burden on the current commission on whatever projects weren’t funded, or the staff wouldn’t be receiving the level of benefits or rates of pay they now enjoy based on previous commission decisions.
This commission, then, has to create the solution regardless of the previous actions.
And that also plays into the Legislature’s thinking. Should a commission be able to combine property and sales tax increases to the tune of 92 percent?
That’s all the ammunition the Kansas Legislature needs to strip the ability of local units of government to propose such an outlandish solution.
What’s more, since previous commissions used additional tax revenue that should have been set aside, how is it that the current commission not only needs to pay the refund but also needs almost $5 million more to repair roads and what Commission Chair Scott Carr characterized as “inflation” costs?
Hopefully this will be the impetus for Seward to add a finance director like the school district, city and college already have.
But don’t be surprised to see the Legislature tie the hands of local units in the future because of situations like these that expose taxpayers to local decisions that can be devastating to their personal finances.
