Real estate taxes jump sky-high
The mid-year report on Blaine’s finances is mostly what city finance staff was expecting, with a standout exception: the real estate excise tax collected by the city is 56 percent more than staff had expected would be generated through property sales in the first six months of 2005.
“We’re already at 100 percent of budget,” city finance director Meredith Riley told city council at their July 25 meeting.
City manager Gary Tomsic added, “That just reinforces what we all see happening in the real estate market around here.”
The city collects half a percent tax on every dollar of real estate sold in the city. Of that, half goes into a fund, paying toward the debt on the 1998 reconstruction of Peace Portal Drive. The other half will pay for the 1994 city hall and annex remodel.
Council member Bob Brunkow asked if the city expects the real estate market to keep up this kind of pace, and keep pumping dollars into city coffers. “That’s hard to predict,” Riley said. “My understanding is the sales will probably continue at least another year.”
Collection of sales tax is also higher than expected this year, with the fund currently 29 percent higher than anticipated in the city budget. Wastewater revenues are also 30 percent higher due to a recent hike in rates.
On the other hand,
water revenues are down five percent.
“Water sales are very dependent on the weather and we didn’t get summer until 10 day ago,” Riley said.