Manhattan Development News
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06/23/26 City Commission Work Session
Published: Jun 23, 2026
City Assessed Valuation Increases 7.76%, Mill Levy May Drop to Maintain Revenue Neutrality
The City Commission received an overview of the city's revenue and assessed valuation for budget preparation. Ben from Baker Tilly presented the assessed value for June 15th, showing a 7.76% increase to $798.6 million for 2025-2026. The county treasurer's report indicates a potential drop in the mill levy rate to 51.056 from the current 54.506 to maintain revenue neutrality, meaning tax revenues would remain the same as the previous year. The presentation noted pending tax exemption requests totaling $4.45 million, which, if approved, would reduce the assessed valuation and potentially increase the mill levy. The difference in valuation between using the total assessed value or subtracting pending exemptions amounts to $324,000 at the city's levy rate. Commissioners discussed how to account for these pending exemptions in budget planning. The discussion also touched upon property tax appeals and the fluctuating valuation of city properties, particularly in Pottawatomie County.
City Considers Increasing Franchise Fees from 4% to 6% to Boost Revenue and Offset Debt
The City Commission discussed the potential increase of franchise fees paid by Evergy and Kansas Gas Service from 4% to 5% or 6%. These fees, currently generating $3.3 million annually for the general fund after a $500,000 allocation to the city university fund, have not been adjusted in 20 years. A 1% increase could generate approximately $945,000, and a 2% increase could generate $1.89 million. The increased revenue could potentially offset debt service costs, thereby reducing the need for property tax increases (mill levies) for bond and interest payments. Commissioners expressed support for utilizing these increased fees to address the city's growing debt service obligations, specifically by shifting mill levy support from the general fund to the bond and interest fund. The discussion also highlighted the city's investments in burying overhead utility lines and the improved safety and reliability resulting from these efforts. The state caps franchise fees at 6%.
Stormwater Utility Update: Fee Structure, Capital Projects, and Fee-in-Lieu Program Discussed
The City Commission received an update on the stormwater utility fund, including its financial status, capital improvement plans, and fee structures. The stormwater fund has an expected revenue of $5.8 million for the year and an anticipated balance of $5 million. Capital expenses are estimated at $4.5 million, with operating expenses at $1.9 million. The fee structure is based on impervious square footage, with a base fee of $9.50 per equivalent unit (ERU) per month and a surcharge of $2.75 per ERU per month to cover levy bond payments. The levy surcharge was increased to $2.75 this year, with no anticipated increase for 2027. The fee-in-lieu of treatment program, implemented last fall, allows developments to pay for off-site stream restoration, with approximately four to five projects already signed up. The commission was presented with a master plan for the downtown east and west watershed, involving several future CIP projects, including collaboration with KDOT on Project 4 for the rebuilding of Tuttle Creek Boulevard. The discussion also covered the challenges with the UP Railroad regarding permits for the levy project and the ongoing development of the Kansas Creek watershed master plan. Comparisons to peer cities indicated Manhattan's stormwater rates are in the middle range and relatively affordable. It was noted that 50% of businesses pay less than $50 per month, and 75% pay less than $100 per month.
City Commission Reviews Water and Wastewater Funds, Recommends No Rate Increase for Wastewater
The City Commission discussed updates and proposed rate adjustments for the water and wastewater utility funds. Randy DeWitt, Director of Public Works, presented information on current fund balances, consumption trends, and projected revenues and expenses for 2027. The presentation highlighted a strong beginning fund balance for both water and wastewater utilities, exceeding budgeted amounts. For water, year-to-date metered consumption was 4.9% higher than in 2025, and revenues were 7.2% higher than the same time last year, putting them on track to meet the annual revenue budget of $15.2 million. For wastewater, year-to-date revenues of $7.1 million represented 48% of the budgeted amount, with a 4.6% increase compared to the previous year, and no rate increases were recommended due to the fund's strong financial position. The discussion also touched on the general fund transfer, debt service payments for infrastructure projects, and cash reserves, with both funds maintaining approximately $13 million in reserves. A potential 3% rate increase for water was forecast, while no increase was recommended for wastewater. Comparisons to peer cities showed Manhattan's rates to be relatively affordable. The commission also discussed the potential for borrowing from utility cash balances for other projects and the management of the investment portfolio.
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The Manhattan News archive
USD 383 Board of Education Meeting - June 24, 2026
06/23/26 City Commission Work Session
06/23/26 City Commission Work Session
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Meeting Agenda (PDF)
06/16/26 City Commission Meeting
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