Title
Approval of an Ordinance Amending 2025 Regular Ad Valorem Tax Ordinance 7409 - First and Final Reading
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Move to approve the Ordinance Amending the 2025 Regular Ad Valorem Tax Ordinance 7409 on first and final reading.
Report
Issue:
Whether to approve the Ordinance Amending the 2025 Regular Ad Valorem Tax Ordinance 7409 on first and final reading.
Staff Contact:
Joan Lutz, Budget & Finance Manager, 360.753.8760
Presenter(s):
None - consent agenda item.
Background and Analysis:
On November 12, 2024, the City Council adopted ordinance 7409 setting the 2025 Regular Ad Valorem Tax. Since then, we became aware that the ordinance does not align with Department of Revenue requirements and that an amended ordinance is necessary to ensure that we are able to levy the full amount.
The City is required to adopt a property tax levy Ordinance and file a levy certification with Thurston County by November 30, 2024. If no certification is filed, the County Assessor will levy the same amount as 2024. Under state law, property tax revenue increases are limited to the lessor of 1% or the Implicit Price Deflator (IPD) on the highest lawful levy amount. State law allows for add-ons from new construction, state assessed property, annexations, and refunds to be added to property tax revenue above the 1% legal limit. The IPD, which is a measure of the rate of inflation for personal consumption, is 2.57% for 2024. As such, the city is allowed to levy the full 1% increase on the highest lawful levy.
The 2025 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 2025. 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 ...
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