FY2009- 2010_Budget Document - Laserfiche WebLink

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As authorized by state law, the City Council has approved certain exemptions to its citizens. Residential homeowners qualify for a homestead exemption that is equal to 20% of their appraised value. Citizens who are over 65 years of age qualify for an additional exemption, which exempts the first $60,000 of assessed value. Additional exemptions are available for the disabled and veterans. For fiscal year 2009-10, the City expects to collect $13.8 million through the ad valorem tax process. The graph below portrays the actual collections for the last four fiscal years, estimated collections for fiscal year 2008-09 and projected collections for 2009-10. Ad Valorem Tax Collections Six Year Comparison 16,000,000 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 04-0505-0606-0707-0808-0909-10 Tax Collections Another major revenue source that is derived utilizing the taxation process is the collection of “In Lieu of Tax” payments from companies located in the City's two industrial zones. A description of the in lieu of tax agreements can be found in the "Description of City and Economic Background" section beginning on page 21. The City expects to collect $8.9 million from this revenue source. The graph on the following page shows that collections have increased over the last three years; however, a decrease is projected for FY2010 due to bankruptcies at a few major plants due to the state of the economy. While it is possible that the City will indeed receive the FY2010 payment, we have erred on the side of caution in projections for next year. In fiscal year 2009, the City entered into new industrial contracts, which extend to December 31, 2019. Industries make payments in lieu of taxes at a percentage of what the City’s taxes would be if 100% of the industry was in the City. The rate under the old contracts was 53%. Under the terms of the new contracts, the annual in lieu payments increased to 62%. After the first six years of the contracts, the percentage increases to 63%.