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Kirkwood Community College sets tax levy increase at 3.8%
Kirkwood faced with higher debt payments and insurance costs
CEDAR RAPIDS — Kirkwood Community College has raised its tax levy rate for property owners across its service area by 5 cents — bringing its overall property tax levy to nearly $1.40 for every $1,000 assessed value for the upcoming 2024 budget year — or 3.8 percent above the current rate.
The increase means a residential homeowner will pay an additional $3.47 on $100,000 of assessed value in the 2024 budget year that starts July 1, going from $72.79 to $76.26. Kirkwood pulls the vast majority of its property taxes from its primary seven-county base of Linn, Johnson, Benton, Cedar, Iowa, Jones and Washington counties.
Campus officials expect the increase to generate $40.6 million in property tax revenue, up nearly $2 million — or 5 percent — from this year’s anticipated $38.6 million in property tax revenue, which Kirkwood aims to use to cover rising costs related to debt payments and insurance programs.
“Insurance program costs are increasing to allow Kirkwood to protect the college from tort liability, loss of property, environmental hazards, or any other risk associated with the operation of the college,” Kirkwood spokesman Justin Hoehn said.
Voters in 2017 agreed to let Kirkwood continue a bond sale levy, first passed in 2005 and renewed in 2012, through 2032. With the levy increasing annually at an average rate of 3.5 percent, or 4 cents — just under the recently-approved bump for next year — Kirkwood’s property tax income has swelled at an annual average of 7.5 percent over the last five years, or $2.3 million a year.
Where Kirkwood’s total property tax revenue in the 2015 budget year was $22.6 million, it today is nearing double at $40.6 million — with expectations the income will continue going up. With taxable growth estimated at 2.5 percent, Kirkwood expects its total levy revenue to reach $47.4 million by 2028 — covering, in part, rising payments on debt taken out for things like its $34 million student center renovation.
The renovation inside Kirkwood’s Iowa Hall — first dedicated nearly 50 years ago — spans 110,000 square feet, offering “modern amenities and resources for students” like study and leisure lounges, a campus store, meeting space, a cafe and coffee bar and multicultural centers.
Kirkwood — praised in its June 2022 audit for improving its fiscal position through “sound financial management strategies” despite declining enrollment and pandemic-related challenges — has been making budget-related moves lately to cut costs while meeting their service area’s needs.
After announcing plans to close its 32-year-old Iowa City campus this year and move most of its operations to a regional center in Coralville, outgoing President Lori Sundberg in January said, “We face a challenge in figuring out how best to support today's students both inside and outside of the classroom, while also balancing our expenses and revenues."
Kirkwood in February announced cuts resulting in 28 layoffs, saving an expected $1.5 million a year.
Kirkwood’s board of trustees, which is in the midst of a search for a new president, hasn’t yet approved its final fiscal 2024 budget but expects to in June.
Vanessa Miller covers higher education for The Gazette.
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