Title
Public Hearing and Approval of an Ordinance setting 2026 Regular Ad Valorem Tax - First and Final Reading
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Hold a public hearing and move to approve, on first and final reading, the Ordinance setting the 2026 Regular Ad Valorem Tax.
Report
Issue:
Hold a public hearing and move to approve, on first and final reading, the Ordinance setting the 2026 Regular Ad Valorem Tax.
Staff Contact:
Joan Lutz, Senior Budget & Finance Manager, 360.753.8760
Presenter(s):
None - Consent Calendar Item
Background and Analysis:
The City must adopt a property tax levy ordinance and file a levy certification with Thurston County by November 30, 2025, for taxes collected in 2026. If the City does not file a certification, the County Assessor will levy the same amount as in 2025. Under state law, annual property tax revenue increases are limited to the lesser of 1% or the Implicit Price Deflator (IPD) applied to the highest lawful levy amount. Additional revenue from new construction, state-assessed property, annexations, and refunds may be added beyond the 1% limit. The IPD for 2026 is 2.44%, allowing the City to levy the full 1% increase on its highest lawful levy.
The 2026 regular levy budget is based on a 1% increase over the previous year’s highest lawful levy, plus allowable add-ons above the 1% limitation for collection in 2026. Should the County Assessor’s Office adjust any levy amounts which impact revenue as they finalize their valuation process, the ordinance will be presented with those adjustments.
The regular levy for collection in 2026 totals $21,803,601, this includes legally allowed add-ons for new construction, state assessed property, and refunds. Based on the current assessed value from the County Assessor’s Office of $11,958,120,711 and revenue budget of $21,803,601, the estimated levy rate per $1,000 assessed valuation is $1.82.
Climate Analysis:
There are no anticipated climate impacts from setting the 2026 Regular Ad Valorem Tax.
Equity Analysis:
The City of Olympia has a goal of ensuring that city services are provided equitably to our residents and business communities, as well as the greater Olympia community. Setting the 2026 Regular Ad Valorem Tax is not expected to further impact known disparities in our community.
Neighborhood/Community Interests (if known):
Members of the community may have an interest in this agenda item as it deals with City finances and fiscal governance.
Financial Impact:
The financial impact will be on Olympia property owners at approximately $1.82 per $1,000 of assessed value.
Options:
1. Hold a public hearing and move to approve, on first and final reading, the Ordinance setting the 2026 Regular Ad Valorem Tax.
2. Hold a public hearing and do not approve the Ordinance setting the 2026 Regular Ad Valorem Tax.
3. Take other action.
Attachments:
Ordinance
Presentation