Matthes: City will probably ask for property tax increase

Friday, May 16, 2014 | 1:10 p.m. CDT; updated 8:39 p.m. CDT, Saturday, May 17, 2014

COLUMBIA — City Manager Mike Matthes presented the 2014 State of the City address Friday morning, outlining Columbia's successes and areas where he feels the city could be doing a better job.

While fielding questions after the meeting, Matthes said the next fiscal year will probably be the time to bring a property tax before voters.

"I believe we'll have to at some point. Our property tax is so low, and our needs are so great," Matthes said. "These are permanent needs the community's going to have, and the best way to fund that is property tax because it doesn't go away in a recession."

Matthes offered no specifics about how much of a property tax increase would be requested, but he did say that any increase would be phased in. He recognized that the Columbia City Council is "very concerned with the impact" the tax would have on the city.

The city's property tax stands at 41 cents per $100 assessed valuation and has remained unchanged for decades. That levy costs the owner of a $200,000 home $155.80 per year.

The city is budgeted to receive $7.3 million in property taxes during fiscal 2014. Sales tax revenue, by comparison, is budgeted at $44.7 million, more than six times as much as property tax income.

Any proposed property tax increase would be subject to a vote of the people. Matthes said a higher tax is necessary to pay for road improvements and more police.

"We are not positioned to achieve the larger aspirations the community has," Matthes said.

During the presentation, Matthes said the city's police and fire departments are 30 percent understaffed. He said the city needs at least 30 new police officers. Columbia Police Department Chief Ken Burton has asked for 42.

Columbia Mayor Bob McDavid has said previously that every new police officer would cost the city $100,000 per year in salary, retirement benefits and equipment. Last August, he proposed a 20-cent increase in property taxes to pay for 35 new officers. He later withdrew his support for the plan when the Columbia Police Officers' Association disagreed with the need for a property tax to pay for the officers.

Matthes said that although there were a number of high-profile violent crimes last year, the city's rate of violent crimes is at a 35-year low. He said Columbia's crime rate is half that of Springfield, one-third of the rate in Kansas City and one-fourth of the rate in St. Louis.

"It's an interesting thing in Columbia that there seems to be a disconnect between the realities of crime and the perception of it," Matthes said. "We'll be working over the next year to grow our effort to community policing."


According to satisfaction surveys Matthes presented, growth management remains one of the largest areas of opportunity for the city. Only 34 percent of citizens are satisfied with how the city is managing growth. Matthes said citizen satisfaction usually correlates negatively with economic development.

"When you live in a community and you love it the way people in Columbia do, you don't want to see it change," Matthes said.

The city manager and his staff made a push earlier this year to establish a tax increment financing district to address infrastructure needs downtown, where a spate of student apartment developments have tapped out sewer and electric capacity. Developers looking to build downtown threatened to pull out if the city didn't come up with a way to ensure adequate utilities. The council, however, voted the TIF district down by a 5-2 vote in February.

"It's just time lost. If we had moved forward in that way, we might have created it by now, and it might have started to raise funds for the purposes we outlined," Matthes said. "We're really sorting through in a slow, public process so everyone has time to get the information and comes to some understanding of what their preferences are."

Positive outlook

Overall satisfaction with the city's customer service increased from 67 percent in 2011 to 69 percent in 2013, but it remains below the high of 76 percent set in 2007. Matthes said that this was due in part to the fact that Columbia has "survived the recession." While he didn't say the recession was over in Columbia, he did say he is cautiously optimistic about the economic outlook.

Columbia remains well below the national unemployment average of about 7 percent. The city's unemployment rate hovered just above 4 percent in 2013. The city also has closed the gap between general fund revenue and spending, creating a balanced budget for fiscal 2014.

Because of these and other factors, the Milken Institute named Columbia the 2013 best-performing small city in the United States, and Forbes named the city the third-best small city in the country for jobs in 2014.

"These are great indicators of our economic development," Matthes said.

Few community members were present at Friday's speech, which was mostly attended by press and city staff. Matthes spoke for about 30 minutes before taking 10 minutes to field questions.

Supervising editor is Scott Swafford.

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Mike Martin May 16, 2014 | 7:57 p.m.

Stop being fooled, Columbia. Your City Hall is THE wealthiest entity in town. It does NOT need more of your money to do the job you're paying it to do.

With $144 million in "unrestricted fund balances" and over $300 million in liquid assets (cash, CDs, etc.) City Hall should be investing in what Columbia needs WITHOUT asking for higher taxes, fees, utility rates, etc. (Source: 2013 Comprehensive Annual Financial Report (CAFR) CoMo)

How much cash does City Hall really have? For the answer, turn to page 53 in the latest CAFR: $382,039,276.00

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