SEPTEMBER 11, 2017
LOUISA, KY. — A raise is property taxes for all taxing districts in Lawrence county is anticipated after a steep drop in assessments of oil and gas and coal severance monies, County Clerk Chris Jobe said today.
“They have a formula and assessments for local property and the mineral taxes are different,” Jobe said. “So it is difficult to tell how much the raise will be in dollars and cents.”
Lawrence Co. PVA Chris Rose said the drop in assessments will force local taxing districts to accept the compensating tax rate which allows taxes to raise in order to take in the same amount in real dollars as last year.
“Our tax roll was certified on August 15, 2017,” Rose said in a message to answer questions by the Lazer staff today. “We show an increase in Residential Class of $2.4 million, an increase in Farm Class of $2.1 million, an increase in Commercial Class of $3.2 million, BUT a decrease in Oil and Gas of $36.7 million and a decrease in Unmined Coal of $9.6 million.”
The Residential, Farm, and Commercial Classes are handled through the PVA offices. The Minerals (Oil, Gas, and Coal) are handled through Frankfort, Rose said.
“They (fiscal court) haven’t set tax rates yet,” Rose said. “It would be safe to say that the compensating rates will go up for all districts. Some may choose the compensating rate, which will give them the same income as last year while some taxing districts will probably raise theirs.”
County judge/executive John Osborne said he doesn’t know what will happen.
“We don’t have enough information on this to be able to quote anything,” Osborne said this morning. There also has been no answer as to how the county will handle an estimated $450,000 deficit in the jail budget announced earlier this budget year.
City taxes will also need to be adjusted for the decrease in mineral assessments although the cup has almost run dry on coal severance taxes already.
“The Fiscal Court has kept their rate the same for several years. It will be interesting to see what they do this year,” Rose added.
The drop will leave Lawrence County assessments $38.6 million less than a year ago, Rose said. The fiscal court will be setting the tax rate at this month’s meeting on September 18 and the school tax rate will be set this month as well. Jobe said the compensating rate is currently 15.10, but next year’s rate will be 16.80. He did not have enough information about the rates to know how much in real dollars taxpayers will be asked to fork out.
State to raise taxes, too
Ky. Governor Matt Bevin has also said the state will need to raise its taxes to get the state pension system back to solvency. Counties will also be asked to pay 50-60% more on their pension plans on the local level but counties will have until July 1, 2018 to make adjustments which could lead to layoffs of county employees. (See Courier Journal story below).
Kentucky pension crisis: Local governments face 50 to 60% increase in pension costs
By Tom Loftus
The Courier-Journal
FRANKFORT, Ky. — Pension costs could jump 50 to 60 percent next year for local governments across the state, according to a letter sent to them Thursday by state Budget Director John Chilton.
To pay its share, Louisville Metro Government’s cost of its employees’ pensions would jump from $76.5 million this year to $120 million next year. For Jefferson County Public Schools, the pension tab for non-teachers would go from $36.4 million this year to $54.8 million.
Information about each county was not available today.
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Chilton’s letter notified hundreds of local government employers across the commonwealth of the specific dollar amount of increased pension costs each can expect when their new fiscal year begins next July 1.
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Chilton’s letter noted that local governments are confronting the same dilemma faced by state government in addressing the pension crisis. “The obvious problem is most employers cannot afford the additional pension contributions, …” Chilton wrote. “The pension plans are in a crisis but so are employer budgets.”
The increased cost to all local governments combined would be about $345.5 million next year, the letter says.
The letter went to local government employers who have employees in the County Employees Retirement Systems, or CERS, pension plans. JCPS is affected because, while its teachers are in the separate Teachers’ Retirement System, its many non-teaching employees like cooks and bus drivers are in the CERS plans.
