Arnold has cut its property tax rate in half.
Council members voted unanimously Sept. 21 to lower the city’s property tax rate to 18.15 cents per $100 assessed valuation. The rate had been 36.6 cents per $100 assessed valuation, according to council documents.
Arnold was required to reduce the rate because city officials made that promise to residents when they asked for a 1-cent sales tax to fund the Arnold Police Department in April, which voters approved with 1,715 yes votes (66.29 percent) to 872 no votes (33.71 percent).
After the reduction, Arnold will collect $639,026 in property taxes, and city residents will save a combined $639,026 in property taxes.
The owner of a home valued at $200,000 by the Jefferson County Assessor’s Office will pay $68.97 to the city each year in real estate taxes, half of the $137.94 that was paid last year.
The city anticipates receiving $7.5 million in sales tax revenue from the 1-cent increase this fiscal year, which began Sept. 1 and ends Aug. 31, 2024, according to the budget that council members approved on Aug. 18.
“It worked out well for us,” City Administrator Bryan Richison said. “Obviously, we are bringing in more money with the sales tax than with half of the property tax. That is very helpful as we try to compete with police pay across the area with the shortage of police officers. I know we couldn’t have negotiated the contract we just did without the tax.”
Arnold Police officers received a 20 percent raise this year and another 10 percent hike next year.
“Without (the sales tax), we would not be competitive and at risk of losing police officers to other agencies, and it would probably be very difficult for us to attract new officers,” Richison said. “It was huge for the city and our ability to maintain a quality and professional police force.”
Arnold residents only saw a decrease in the property taxes – on real estate and personal property – that is collected by the city.
Property taxes levied by the Fox C-6 School District, Rock Community Fire Protection District, Jefferson College, Jefferson College Library District, Rock Township Ambulance District, Jefferson County and the state did not decrease.
The sales tax to help fund the Police Department increased the city’s overall sales tax from 1.25 cents per dollar of sales to 2.25 cents per dollar.
The total sales tax people pay in the city ranges from 9.6 cents to 11.6 cents per $1 spent depending on where they shop, because some stores are in special taxing districts.
In addition to the 2.25-cent sales tax that goes to the city, the overall sales tax charged in the city includes 4.225 cents for the state, 1.625 cents for the county, 1/2 cent for the Rock Community Fire Protection District, 1/2 cent for Jefferson County 911 Dispatch and 1/2 cent for the Rock Township Ambulance District.
“Depending on how much you spend while shopping in Arnold, (a resident) may break even or even come out ahead on this with the savings you get on property tax,” Richison said. “It is hard to say because it is a case-by-case basis based on the value of a home and how much someone spends shopping in the city.
“The big thing is the property tax is something you don’t have a choice in. If you own property in Arnold, you pay our property tax. It also is only paid by Arnold residents. With the sales tax, if you don’t want to pay our sales tax, you can shop somewhere else. There also are a lot of people from outside of Arnold who shop here and are helping pay the tax to fund the Police Department. It is kind of shifting some of the burden for our Police Department to stay competitive from our residents to everyone who shops in Arnold.”