Dixon City Council considers increase in property taxes

DIXON - Property taxes in the city of Dixon could increase despite a steady decline over the past several years.

The proposed property tax levy for fiscal 2025 is just more than $5.1 million, 5.51% more than what was levied in fiscal 2024. That translates to a $33 increase for the owner of a $100,000 home, upping the city’s portion of their tax bill to about $791.

At Monday’s Dixon City Council meeting, there was a public hearing for the levy, and Dixon resident Kyle Ferrebee raised concerns about a potential increase.

“It seems like it just keeps going up,” Ferrebee said. “It’s really starting to hurt.”

The city hasn’t been raising property taxes, however, in recent years, Mayor Glen Hughes said.

An individual bill may have gone up but that could be because of increases by other local taxing bodies or the value of the home increasing, Hughes said.

From 2015 to 2020 the city’s property tax rate either increased or had no change, Finance Director Becky Leslie said.

In 2015, the city’s portion of the tax bill on a home valued at $100,000 was about $816. By 2020, that grew to about $848, Leslie said.

However, since then, tax rate has decreased. In 2023, the rate dropped to about $758 per $100,000 of home value, Leslie said.

She emphasized that although the tax rate is expected to increase, it’s “still less than what we were in 2013,” which was about $817 on a home valued at $100,000, Leslie said.

Ferrebee still questioned the need to raise property taxes at all. He pointed to the city’s projects currently underway that “tax dollars are being invested, millions, into it.”

One example he cited was Dixon’s $12 million riverfront development project, also known as Project Rock.

Hughes said the funds for those types of city projects “are set aside over time from budget surpluses” and don’t “directly impact the change in your real estate taxes.”

Project Rock, for example, is primarily being funded by a $12 million grant through the U.S. Department of Transportation with the city contributing $788,000 in local infrastructure funds.

About 45% of the property tax revenue will be used to fund the police and fire pensions, 27% will fund public safety, 13% for the Dixon Public Library, 10% for public works and 5% for workers compensation and liability insurance, Leslie said.

The city also expects the actual increase to be less than the estimated $33.

That’s in part because the assessed values for properties within the city will not be finalized by Lee County until May 2025 and because the city is limited by a state tax cap.

State law limits how much most local taxing agencies can increase their property tax levy, tying the increases to the rate of inflation plus the value of new development. The inflation rate the city will be limited to is 3.5%.

The levy is based on projections, Hughes said. If new growth is up, the city may get the full amount it’s requesting. If it’s not, it won’t.

The council will vote on whether to approve the levy at its next meeting Dec. 16. If approved, it will then be filed with the county Dec. 17.