The Manhattan City Commission took the first step toward approving its 2024 budget Tuesday night.

Commissioners first voted 4-0 to exceed the revenue neutral rate of 47.613, to allow the city to capture economic growth from the previous year. Commissioners then voted 3-1 to lower the overall mill levy from 50.74 down to 49 mills. Doing so would drop the overall increase in property taxes to around 4% versus the 6% city staff initially presented. The total budget authority currently is nearly $225 million, which includes over $35 million in ad-valorem taxes.

Commissioner Wynn Butler says the city has to do something to offset the roughly 9.5% valuation increases seen this past year.

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Commissioner John Matta says utilizing some of the federal Coronavirus relief funds currently in the city’s cash reserves could help give taxpayers at least some relief.

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Deputy City Manager Jason Hilgers cautioned the decrease, which would be over 3 mills from the initial 52.15 proposal earlier this summer, would result in the city collecting about $2.1 million less in property taxes.

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Hilgers says the approach from commission may be short lived and suggested strategies be explored at the January retreat to get rid of the mill levy as tolerance for property taxes he says continues to dwindle. He says there are other avenues the city can explore to capture revenue.

The lone dissenting vote Tuesday was Commissioner Linda Morse, who favored the city’s proposal of a 6% increase in property taxes.

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Mayor Mark Hatesohl was hesitant to go along with such a deep mill levy reduction, but noted he would like to see deeper discussions happen to find other ways to lower cost of living barriers in Manhattan.

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Commissioners will look to finalize the budget at its September 19 meeting.

In other business Tuesday, commissioners unanimously approved on first reading a request from Downtown Manhattan Inc. for a common consumption area for alcohol on Poyntz Ave. from 3rd to 5th Street for the October 19 Third Thursday Street Faire and Maker’s Market event.

Commissioners also unanimously approved a $914,000 purchase agreement for the eventual development of a new city fire station to be constructed at 3830 Excel Road. The fire station is necessary for the eventual biotech manufacturer Scorpius, which is planning a facility at Excel Road and Hwy 24.

The commission also approved close to a $500,000 agreement with Overland Park-based Stantec Consulting Services for the East Manhattan Gateway Plan, authorizing the city staff also to solicit patrons to serve on advisory committee for the plan.