Columbia City Council to review budget, property taxes at Monday night meeting
Mitchell Kaminski
COLUMBIA, Mo. (KMIZ)
With less than a month before the 2026 fiscal budget is expected to be approved, the City Council will hold the second of three public hearings at City Hall as staff brace for a tighter budget after expected tax revenue fell 3% short last year.
The 2026 budget projects roughly $560 million in expenditures. Columbia allocated $563 million of its total spending for the 2025 fiscal year.
According to the city, the proposed changes would increase water utility revenue by 12%. However, despite the increase City of Columbia expects water bills to decrease for 65% of residential customers under the three-tier system based on average water use.
The City Council is looking to vote on the final budget on Sept. 15 before the new fiscal year begins on Oct. 1.
The City Council will also be holding a public hearing on setting the property tax rates. Roughly 8% of the general fund revenue comes from property tax, which brought in approximately $11.1 million last year.
Property tax rates are established annually within limits set by Missouri’s constitution and statutes. They are based on revenues from the prior year, with adjustments for inflation. Growth from new construction, property improvements, and increases in personal property valuation are excluded when calculating the rate. The resulting figure becomes the city’s permitted tax rate if it falls below the legal ceiling, which in Columbia is currently $0.4125 per $100 of assessed valuation.
For 2024, the city’s tax rate was $0.4075 per $100 assessed valuation. For 2025, the rate has been reduced to $0.3907, as certified by the Missouri State Auditor. The decrease reflects the Hancock Amendment, which limits the growth of existing property values for tax purposes to the lesser of the Consumer Price Index or 5%. Because assessed valuation growth exceeded 8% this year, the city had to roll back the rate to comply with the law.
Under the proposed ordinance for 2025, a tax of $0.3907 per $100 assessed valuation would be levied on all taxable property in Columbia. If the state auditor determines the city’s ceiling is lower, the rate will be adjusted to the auditor’s ceiling.
Despite the lower rate, both the City of Columbia and Columbia Public Schools expect to collect more revenue in the upcoming fiscal year due to rising property assessments.
CPS Chief Financial Officer Heather McArthur confirmed the calculation in an email to ABC 17 News, noting the CPS finance committee will also be reviewing the tax rate calculation during its Monday night meeting.