BonnerSprings.com

Property valuation in Edwardsville is more than $1 million below what was anticipated by city officials when they approved the 2012 budget.

But home and business owners in Edwardsville won’t see an increase in their property taxes to fund the resulting property tax shortfall.

City Administrator Michael Webb said Monday night during the city council meeting the reduction of almost $1.26 million in valuation wasn’t a matter of any mistakes made by the city or Unified Government. He called it a timing issue.

At the center of the reduction is the Earp Distribution project. The city last year issued industrial revenue bonds to Earp Distribution, a wholesale provider of foods and goods to McDonald’s and Chipotle Mexican Grills, to build a new facility on the corner of Woodend Road and 98th Street — that facility is now open. Included in the agreement with Earp was a tax abatement agreement in which Earp would make payments in lieu of property taxes for the first 10 years of its operation in Edwardsville.

The final series of IRB’s was issued to Earp in November 2010, Webb said, but Earp didn’t receive its IRB tax exemption through the Kansas Board of Tax Appeals until June. So the distribution center hadn’t yet been taken off the property tax roll in July, when the Unified Government reported estimated property valuations to Edwardsville. The estimate — $45,220,327 in total assessed property valuation in Edwardsville — was used by city officials in developing the 2012 budget.

But the certified, or official, tax roll, received by the city last week, had correctly omitted Earp Distribution, thereby reducing total valuations to $43,957,020.

Webb said he wasn’t aware in July the Unified Government hadn’t yet taken Earp Distribution off the tax roll, since the agreement with Earp had been entered into more than a year and a half ago. He said it was normal for there to be some small adjustments from the estimated valuation presented in July to the official valuation later in the year, but those adjustments had always been negligible in previous years.

“And so what’s happened is as the value goes down, then the mill levy that is basically established at the county level that they will put on the tax roll has gone up,” Webb said. “Again, normally that (adjustment) is fairly small, but I know we spent a fair amount of time on this topic during the council meeting(s), so I wanted you to be aware of it.”

The real question on the table Monday night, then, was what to do regarding the city’s mill levy.

Webb offered the council two options: To take no action, which would result in an increased mill levy of 45.772 mills; or to adopt a resolution requesting the Unified Government set the city’s mill levy at the original levy, 44.505 mills, that had been agreed upon by the council as part of its adopted 2012 budget. This latter option, Webb said, would mean a decrease in the 2012 general fund cash balance, or contingency reserve, of $42,658 and a decrease to the debt service cash balance of $13,552.

A mill is $1 in taxes for every $1,000 in assessed valuation.

Without any discussion, the council quickly and unanimously approved adopting the resolution requesting the Unified Government hold steady the original mill levy of 44.505 mills.

Also on Monday, the council:

• Unanimously approved the minutes from the October 10 meeting.

• Unanimously approved payment of bills totaling $152,076.

• Proclaimed Saturday, Oct. 29, 2011, as Buddy Poppy Day “in recognition of the Veterans of Foreign Wars Post 6401 and their constant support for (veterans) programs and to help meet the needs of veterans in Edwardsville,” as the proclamation, read by Mayor John “Tiny” McTaggart, said.

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