After local elected officials voted to freeze property taxes , leaders across the Unified Government of Wyandotte County and Kansas City, Kansas — including police and fire chiefs — are being asked to tighten their belts. Around $17.4 million in cuts may be necessary next year.
Following a move that dives into “uncharted water,” County Administrator David Johnston said the Unified Government is taking a hard look at its finances.
Elected commissioners voted 9-0 last month to forgo any new revenue from property taxes, rejecting advice of top staff. The decision answered the pleas of residents desperate for local tax relief, and is expected to result in service cuts.
The Unified Government has no clear path to balancing its budget yet. Options under consideration include eliminating vacant staff positions, pursuing fewer grants requiring local match funds and putting longer-term projects on hold.
Every department will be asked to help address a newfound reality where less money is coming in and expenses are going up, Johnston said.
“It’s our hope that we don’t have to affect people’s lives with a layoff or a furlough program,” Johnston told The Star during a recent interview, in which he referenced measures taken during the Great Recession of 2008.
“Our hope is it’s a last resort,” he added.
Commissioners’ action also accelerated the budget process. Financial planners are now in a scramble to assemble a proposal that must be adopted by Aug. 15 in order to meet a state deadline.
Expenses will rise for county and city services next year — and some factors are beyond the ability of local officials to control.
One reason is inflation, a cost that impacts the Unified Government at a greater rate than the average consumer. For example, the material costs for public works projects, such as road maintenance, carry inflation costs that have in past years risen as high as 20%.
Another is contracts. The Unified Government is required to pay for increases built into collective bargaining agreements and existing service contracts with third parties, like roughly $2.3 million in information technology and cybersecurity improvements.
Local governments are also losing federal funding meant to ease the burden of the COVID-19 pandemic. Roughly $2.4 million of that money went to pay for Kansas City, Kansas’ portion of the regional public transit authority — and will be unavailable moving forward.
Soaring appraisals
Tax rates set by the Unified Government have remained largely flat over the past 10 years. The rates in Kansas City, Kansas, and Wyandotte County now are lower than they were in 2015.
But property tax bills have still been on the rise. Earlier this year the Wyandotte County Appraiser’s Office issued a report saying the median price of a home stood at $235,000, roughly 27% higher than two years earlier.
Under Kansas law, appraised values set by the county reflect trends of the real estate market. Kansas City faces a housing shortage, and Wyandotte County homes are still relatively cheap compared to others in the metro.
Increases on tax bills — felt in all corners of Wyandotte County — have left many residents frustrated. Dozens filled City Hall late last month, calling on commissioners to ease their financial burden, as some said they were on the brink of losing their homes.
Local officials have tried to provide some targeted relief on property taxes for Wyandotte County, where roughly 16% of residents live in poverty.
Programs administered by the Unified Government expanded last year offering rebates to qualified residents who are seniors or disabled and make less than $40,501 per year.
Tight budget
Even before this decision, the Unified Government’s budget was already tight.
The Unified Government has relied on dipping into reserve funds to balance the books over the years.
Discretionary spending in Wyandotte County has been highly limited. And commissioners have previously turned down deep cuts to city and county programs.
Last year, facing troubling financial forecasts, commissioners rejected a proposal that could have slashed about $22 million in expenses.
Serious reductions were proposed for public transit, parks and recreation, and police outreach programs like the Police Athletic League, to name a few. But the majority of commissioners deemed those programs too essential.
The budget Johnston presents next month will be his second. He was hired in March 2023 to fill the top government role in part to help right the ship.
Johnston said Wednesday an interesting few weeks is expected ahead as Unified Government leaders seek to identify potential savings. While he warned the community may see some changes, he says the Unified Government will continue to provide essential services.
“Whatever resources we have, we will work to provide the best possible services that those funds can provide,” Johnston said.
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