City sales tax higher, property tax lower than average

McCOOK, Neb. — City of McCook residents are paying more per capita in sales tax but less in property taxes, at least compared to other cities the same size.

The McCook City Council heard Monday night at the regular meeting an overview of the city’s audit report of the 2019 financial statements presented by Joe Stump, CPA, of Almquist, Maltzahn, Galloway, and Luth. This included a comparison of per capita costs with 10 similarly-sized cities in Nebraska, ranging in population from 3,000 to 10,000.

Recommended per capita costs for sales tax is $305, with the City of McCook at $331. For property taxes, recommended per capita cost is $205, the city at $185 per capita. Stump said the statewide average for property taxes is at .31 cents. The City of McCook property tax levy is 0.349044.

The city’s valuation is at $404,673,163, compared to the recommended at $311,119,121.

The comparisons also included governmental expenses of each city department, with Stump saying the results are little “skewed” in the fire department, as most fire departments in the comparison have volunteer fire departments and the City of McCook has a paid department. Per capita costs for the McCook City Fire Department is $138; the recommended is $64 per capita.

Other city departments with higher per capita costs than what is recommended were: HandiBus, $19, ($10 recommended); Civil defense, $2 ( $1); Health operating and perpetual care, $76 ($65).

Stump also pointed out deficiencies in the operating income/revenue in the city’s water and solid waste funds. Both are recommended to be at 15%, with the city’s water fund at -0.49% and the solid waste fund at -0.59%.

“Whenever you’re looking at negative numbers, you need to look at raising rates or cutting costs, or you’ll run out of money,” he told the council. Late last year, the McCook City Council approved raising water rates by 6 % and sewer rates by 3%. Both went into effect this January.

The city’s sewer fund is at 18.92%, with $15% recommended.

In the summary of revenues and expenses, the city netted total revenues of $7.5 million in 2019, compared to $7.1 million in 2018. Of that, $1.4 was collected from property taxes ($1.3 million in 2018), $2.5 million in sales tax, $547,879 in other taxes and fees and $1.5 million in state allocations.

Excluding water, sewer and solid waste funds, that are operated on user fees, the city had $8.6 million in expenses in 2019, compared to $7.6 million in 2018.

Increase in net position for 2019 was $710,085, compared to $930,406 in 2018.

After the report, the only comment from the council came from Mayor Mike Gonzales, who noted the negative balances in the city’s water and solid waste funds.