For the second time in recent years, the city of Mission is considering a property tax increase to help fill a budget deficit.
City officials emphasize that the move is meant to ensure the city’s reserves remain padded enough while the city also maintains enough general operating funds to pay for resident priorities like street maintenance and solid waste services.
With a proposed tax increase on the table, along with some other budgeting moves, the city is still facing a nearly $50,000 deficit for its 2026 budget.
The upshot could be nearly $200 more in annual taxes the average Mission homeowner may have to pay the city next year.
The Mission City Council is weighing an increase in the city’s mill levy rate, which determines homeowners’ taxes that go directly to the city, of up to 3.5 mills for next year.
If that total increase is approved, then Mission’s 2026 mill levy rate would be 22.007 mills.
Mission is one of just a couple of Johnson County cities proposing a mill levy rate increase for 2026.
(Westwood is also considering a property tax increase. While most other Johnson County cities are either lowering their property tax rates or keeping them flat, most homeowners will still pay more in property taxes overall next year due to still-rising valuations across the county.)
2026 budget has trimmed down projected deficit to $49K
Similar to the 2024 budget cycle, Mission is facing a deficit in its 2026 budget. The projected deficit for next year has loomed as large as $900,000.
As officials pieced together the proposed 2026 budget this summer, the city was able to bring the projected deficit down to approximately $49,000.
That gap was made up in part by proposing the property tax increase.
To trim more of that budget gap, the city’s plan also includes holding off on roughly $200,000 in spending in the current year’s budget, holding staff positions vacant and, ultimately, cutting another $200,000 from contracts and commodities in the 2025 and 2026 budgets.
City officials point out revenues for 2026 outpace expenditures but the overall budget drops into the red when taking into account a roughly $1 million transfer into other funds, like the capital improvement fund for street maintenance and the solid waste fund.
Officials have said they plan to still transfer that money out of the city’s general fund to other funds even though it essentially creates the deficit because that spending is connected to services residents have said are priorities, including street maintenance, parks and solid waste.
What’s the impact on residents’ tax bills?
In July, the city council approved exceeding the state-mandated revenue neutral rate and set the highest possible mill levy rate for 2026 at 22.007 mills.
The revenue neutral rate is the level a city or local taxing jurisdiction sets its property tax rate at in order to generate the same amount of revenue generated the previous year.
Mission homeowners can calculate the portion of their tax bill they will pay to the city itself with the following formula:
- Multiply your home value by the residential assessment rate in Johnson County, which is .115.
- Take that number, divide it by 1,000 and multiply the outcome by the city’s property tax rate in mills.
If the city adopts the 22.007 mill levy rate, the average Mission homeowner will pay roughly $890 to the city in 2026 property taxes.
If the city holds the mill levy rate flat for 2026 at 18.507 mills, the average Mission homeowner would pay roughly $748 in city property taxes next year. This year, the average Mission homeowner paid roughly $695 in 2025 city property taxes.
Reminder: The entirety of a homeowner’s property tax bill also includes rates set by other jurisdictions such as the county, school districts and fire departments.
A closer look at the 2026 budget
The city of Mission’s 2026 general fund budget features about $16.3 million in total revenues, the largest revenue source being property taxes at $5.1 million.
Projected sales and use taxes (a tax on a use of a good or service) come in at $4.4 million for 2026. The city is getting another $2.2 million worth of the same type of revenue from the county.
Mission plans to spend a total of nearly $14.8 million in 2026, excluding the roughly $1 million worth of transfers to other city funds dedicated to different amenities like streets, parks and solid waste.
The city’s largest expenditure in 2026 is on personnel, coming in at nearly $10.2 million. The next highest expenditure is contractual services at $3.7 million, followed by transfers to other funds.
“Don’t take mill increases lightly”
The city council has been discussing the 2026 budget since April, when the budget cycle typically starts for cities.
Councilmember Ben Chociej, at the Aug. 20 city council work session, said the city doesn’t “take mill levy rate increases lightly by any means.”
Still, Chociej pointed out that in the past several years, the city has had to refund large retailers close to $1 million in sales and use taxes after those businesses appealed their tax bills.
In 2025 alone, the city has already refunded $330,000 to a “local utility company” that appealed its tax bill, according to city documents. Officials did not name the company.
The total amount of refunds the city has had to pay lines up with the city’s nearly $1 million budget hole, Chociej said.
“Some of the larger taxpayers, especially commercial taxpayers, have the resources to fight their tax bills,” Chociej said. “My view is that what we’re seeing here in this budget is that when that happens, these are shifted on residential taxpayers, pretty much directly one-for-one.”
Chociej said it is difficult for the city to forecast sales and use tax refunds, and often, such refunds come months to years after the city has already dedicated those dollars.
Some governing body members that same night asked city staff to spread the word about the city’s community rebate program to help elderly and low income residents who may need assistance paying their property tax bills.
In 2025, the city’s community rebate program has distributed a little more than $25,000 to 29 households for rebates for city property taxes and utility, stormwater and solid waste fees.
“A perfect storm”
During a June 25 budget work session, City Administrator Laura Smith broke down the projected $900,000 deficit for the city council, calling it “a perfect storm.” (You can watch that entire work session online here.
Smith told the city council on June 25 that some contributing factors that led to the $900,000 hole include the following:
- Sales and use tax refunds in 2022, 2024 and 2025 (caused by large retailers or utilities appealing tax bills)
- A shift in property and casualty insurance providers in 2025, resulting in the city paying one-and-a-half times more in insurance premiums
- Over-budgeting for the estimated building permit and plan review fee revenues in previous years
- Close to $500,000 losses resulting from the city’s audit, including a roughly $265,000 correction to the capital improvement fund
The city has also expressed a desire to upgrade its police department and city hall facilities, Smith said.
Smith said if the city did not transfer money to the capital improvement fund for street maintenance, the budget would be balanced. Still, street maintenance is a resident priority, she said.
“We’ve tried to stretch ourselves as far as we possibly can to meet the priorities of the residents in our community,” Smith said.
In order to help fill the hole in other ways, aside from a property tax rate increase, city staff has done the following as it prepares the 2026 budget, according to city documents:
- Cut $200,000 from the 2025 budget and another $200,000 from contracts and commodities in 2025 and 2026
- Commit to transferring only $850,000 to the capital improvement fund (opposed to the typical $1.4 million in other years)
- Cut full-time staff positions that are already vacant from the budget
- Delay large purchases like a street sweeper and technology upgrades
- Exclude any “wish list” budget items from any department
With the 3.5-mill increase to the property tax rate and the internal changes to the budget city staff has made, the city is still looking to fill a $49,000 hole to balance the budget while maintaining its goal of having a general fund reserve balance of 25% of the overall budget.
Next steps:
- The city is expected to consider adopting its budget, and setting its 2026 mill levy rate, at its Sept. 17 meeting.
- Mission City Council meetings start at 7 p.m. at City Hall, 6090 Woodson St.
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