Merriam homeowners may be getting a lower mill levy rate in 2024, but that doesn’t necessarily mean they’ll owe less in property taxes.
The city is proposing a 0.25-mill decrease to the city’s mill levy rate. This would be the first change to the mill levy rate since 2008, when the city raised it to its current rate of 27.665.
Merriam is still in the middle of the budget process, though, so no changes are concrete just yet.
How will this impact my property tax bill?
The mill levy rate is used to calculate how much in taxes a property owner pays to the city based on the owner’s assessed home valuation.
Merriam’s proposed mill levy rate for 2024 is 27.415, down 0.25 mills from the current 27.665.
To calculate your tax bill to the city, you multiply the value of your home by .115, which is the residential assessment rate.
You take that number and divide it by 1,000 and then multiply it by the mill levy rate.
For example, to calculate using this formula at the proposed 27.415 mill levy rate, the homeowner of a $281,832 house (the average home value in Merriam) would pay $888.54 in property taxes to the city.
To compare to last year, the homeowner of a $254,830 home (the average Merriam home value in 2022), would have paid around $810.74 in property taxes to the city.
Neither of these numbers includes taxes owed to other jurisdictions, such as the county and school districts.
Merriam may still exceed the revenue neutral rate
- The revenue neutral rate is the mill levy rate that would result in the same amount of property tax revenue as the previous year under the current year’s valuation. Merriam would have to reduce its mill levy by 2.1 mills to 25.547 to keep its revenue neutral rate.
- But with home valuations on the rise — a trend happening across Johnson County – Merriam could still end up taking in more revenue from property taxes than last year, even if it decreases the mill levy rate.
- City Administrator Chris Engel said the city will “still be painted as raising taxes because the mill levy is going up while the mill levy rate is going down.”
More than half of the city’s revenue comes from sales tax
- Donna Oliver, the city’s finance director, said 58% of the general fund revenue comes from sales tax, 39% of which is from automobile sales.
- Property tax accounts for 22% of the general fund revenue, 12% from residential property taxes and 10% from commercial property taxes.
- Oliver said using the proposed mill levy rate, the city estimates bringing in $7 million from property taxes — about $500,000 more than what would be levied under the revenue neutral rate. To compare, the city estimates $18 million in sales taxes for 2024.
Next steps:
- The city council on July 10 will see a draft budget review, and need to decide whether or not to exceed the revenue neutral rate.
- If the city council opts against exceeding the revenue neutral rate, then a resolution to adopt the budget will be considered on Aug. 7.
- If the city council decides to exceed the revenue neutral rate, then a resolution to do so will be considered on Aug. 21 immediately followed by a resolution to adopt the budget.
Other budget news: Lenexa looks to lower property tax rate for sixth year in a row
