URBANA — The city comptroller expects that Urbana's assessed valuation will drop by about 0.5 percent this year, and the city council this week will begin its discussion on what property-tax rates will look like in the coming year.
According to a memo from comptroller Ron Eldridge to the city council, he estimates that the value of existing properties in the city of Urbana will drop an average of 1.5 percent, but new construction will account for an increase of 1 percent.
City council members this week will take a first look at the annual "Truth in Taxation" resolution, which marks the formal beginning to the property-tax-rate discussion. They will meet as a committee of the whole at 7 p.m. Monday in the Urbana City Building, 400 S. Vine St.
State law requires that municipal boards like the Urbana City Council cap their own property-tax-levy increases with a resolution in advance of the formal vote to approve a new tax levy. If the ceiling they eventually approve is 5 or more percent higher than last year's levy, that would trigger a number of legally required steps to inform property owners.
The ceiling city council members are expected to support is $8,057,661, according to the resolution that city administrators will present. That would be 4.5 percent higher than this year's $7,710,681 tax levy.
That action only establishes a property-tax limit and does not mean it's likely that city council members actually intend to increase property taxes. That decision will not be made until Nov. 19.
The higher ceiling, however, allows city officials some room for error if actual assessed values are calculated to be significantly different than their estimates.
If the city council maintains last year's property-tax rate of $1.31 per $100 of equalized assessed value, the average Urbana homeowner would pay less this year because of the estimated drop in the city's total assessed value.