County commissioners begin their first budget meetings with department heads Thursday as they consider a quarter-mill decrease in the county’s property tax rate along with a sobering assessment by County Manager Penny Postoak Ferguson that revenues will not keep up with expenses over the longer term.
“We’ve got to really prepare ourselves in the coming budgets,” Postoak Ferguson told commissioners as she outlined her proposed budget last week.
During that presentation, she said current trends in housing valuations and tax revenues will continue to put pressure on the county’s property tax rate, or mill levy.
“The five-year forecast is not sustainable,” without significant future policy decisions impacting expenses or revenues, she said.
Postoak Ferguson said her proposal for 2025’s budget would maintain existing services with limited expansion but does not rule out future adjustments to “above and beyond” services that were unspecified.
She added that her proposed budget would maintain financial strength and the county’s AAA bond rating while also keeping the county competitive in salaries.
“We feel like this budget gets us where we need to be this year,” she said. But, “we do have our work cut out for us in coming budgets.”
What we know about the proposed 2025 budget
Postoak Ferguson, acting on a previous discussion at the commission’s annual budget retreat, submitted a $1.83 billion budget and capital improvement program.
It includes:
- $1.366 billion in expenditures and $461.7 million in reserves
- A decrease in the taxing rate of a quarter mill, bringing the property tax levy for county services from 24.360 mills to 24.110 mills. That would be the seventh mill levy rollback in eight years.
- Levies for the library and parks — which have their own taxing districts — would remain unchanged from this year at 3.812 mills for the library system and 3.022 mills for the park and recreation district.
- 4,355.6 full-time equivalent positions are included, with 37.5 of them new. Of those, 3.5 would be paid with county taxes. Others would be paid through fees, grants and funding such as opioid settlement funds.
The total budget reflects all of county spending, including that which comes from other sources like wastewater user fees. Once reserves and dedicated funds are subtracted, the spending on county general services would be $530.7 million.
The decrease in the taxing rate, if it is approved, does not necessarily mean next year’s property tax bills will be lower. The tax rate set by the county represent only a small part of homeowners’ total property tax bill, with school districts taking up the largest chunk.
Lowering revenues, rising costs
Economic trends this year are hitting the county from both the revenue and inflation side, Postoak Ferguson told commissioners.
Steeply rising property valuations, which have been the talk of the county for the past few years, have begun to stabilize. The growth in assessed valuation projected for 2025 is 6.76%, compared with 11.19% for 2024. Since property taxes are paid based on the value, that means a likely decrease in revenue.
At the same time, county budget analysts project a loss in revenue from sales taxes, investment interest and mortgage recording fees compared with 2024.
Meanwhile, inflation has continued to climb as have the needs of a growing population that includes significant increases in the number of residents with disabilities or who are 65 or older, Postoak Ferguson said.
A tight labor market continues
Last year, commissioners took steps to bring pay for county employees closer in line with the market by raising pay tables. But the low unemployment rate and labor shortages have continued.
Postoak Ferguson proposed a 3.5% merit pool and a 1% market increase for the county employee table, as well as a 1% market rate increases for employees in the sheriff’s office and MED-ACT, the county’s ambulance service, to keep the county from falling behind again.
The new full-time positions being added include one adult diversion officer for the district attorney’s office, an environmental health specialist to take over inspection of sewage treatment and swimming pool safety now that Overland Park no longer does it, a cybersecurity expert and a human resource partner to support the ambulance service.
Positions would also be added for mental health, the library maker space, a housing specialist and a substance abuse counselor for the Department of Corrections.
Commissioners’ first takes on the budget
Commissioners expressed caution after taking in Postoak Ferguson’s presentation last week.
Chairman Mike Kelly said it’s important to maintain solid financial footing and the AAA bond rating, which he called “sacrosanct.”
But he also noted concern about how future county services — and hence the quality of life that makes Johnson County desirable — could be affected.
Kelly asked for information on what a budget would look like maintaining the current mill levy rather than reducing it.
Commissioner Janeé Hanzlick wondered how the property tax rollback would affect future budgets.
The monthly increase in taxes on a $500,000 home would be $7.90 with a flat tax rate and $6.62 with the rollback, Hanzlick was told. That amounts to a difference of about $13 a year, Hanzlick said.
“It’s important that we keep that in mind,” she said. “Is it worth $13 a year to maintain our services, maintain our response time, maintain the ability of the county to provide excellent service?”
Commissioner Charlotte O’Hara, who has been critical of spending on a new health services building and homeless shelter in the past, said the tax levy rollback was more than made up for by rising property values, which are still increasing but at a slower rate than before.
“Rolling the mill levy back doesn’t mean we’re decreasing taxes. We’re increasing taxes,” she said. “I can’t explain this to my constituents whose taxes have more than doubled since 2017.”
Next steps
Commissioners will go into finer details with department heads in a series of meetings beginning this week.
There will also be opportunities for public input at budget open houses at:
- 10 a.m. to noon and 5 p.m. to 7 p.m., June 3, at Central Resource Library, 9875 West 87th St., in Overland Park
- 10 a.m. to noon and 5 p.m. to 7 p.m., June 10, at Monticello Library, 22435 West 66th St., in Shawnee
Information also will be available from 4:30 to 6:30 p.m. on June 19 at the county’s Juneteenth event at Lenexa Civic Campus Commons, 17101 West 87th St.
The commission will begin budget deliberations June 21 and set its maximum spending June 27.
The process culminates in August, with a public hearing at 6 p.m. on Aug. 20 at the county administration building, 111 S. Cherry St., in Olathe.
The final budget for 2025 is expected to be adopted by the commission on Aug. 29.
