The Fiscal Year 2026 municipal budgeting season has come to a wrap. The final Public Hearing has been held. The Webster County Beacon website already has levy rate information calculated and displayed.
Fort Dodge’s Fiscal Year 2025 tax levy was $20.955 per taxable thousand. Fiscal Year 2026 levy has settled in at $20.75 per taxable thousand. City leaders were quick to point out that the levy rate is down nearly twenty cents. But did that result in an overall property tax decrease?
That question is subjective – It depends who you ask. There can be stark differences in opinion at the local level where budgets are drafted up, and at the State level where legislation and policy regarding budgeting is crafted. Understanding the formula for how the property tax portion of local budgets are determined is essential to form your opinion.
Part of the process starts nearly a year and a half in advance, depending on the year. That process starts in the County Assessors’ Office. That department is tasked with assigning market values of property within the County. Assessments generally come out every two years. This year was a property revaluation year. That was the letter property owners received the last week in March from the Assessor’s Office (Not to be confused with the letter received from the County Auditor’s office – we’ll talk about this a little later). This is important: The assessment that just took place in January of 2025 is used in the formula for Fall of 2026 and Spring of 2027 property tax payments. The budget hearings that just took place correlate with your 2023/2024 assessment.
Now, you might be asking yourself ‘Why does the Assessors Office raise our property values?’ The simple answer is they have to. At the State level, the Iowa Department of Revenue is tasked with supervision of the assessment process. If things are not on the up and up, the State will find their way into the process.
Think that was a lot? Well, there’s more. That assessed value is not simply used for figuring property taxes. The assessed property value goes through the assessment rollback adjustment, a percentage adjusted each year by the Iowa Department of Revenue. Then from there, a Homestead or Military exemption could be applied to certain properties. Once that assessed value makes its way through rollback and exemptions, the property is given a Taxable Value. There you have it, the first value used in the property tax valuation – Taxable Value.
Next, we have to come up with the levy rate. $20.75 per thousand for Fort Dodge, right? Right, but there’s more. For Fort Dodge residents, there is the City of Fort Dodge, Webster County, Fort Dodge Community School District, and Iowa Central Community College (plus a couple minuscule State initiatives). Each one of those taxing entities set their own budgets and levy rate. Remember the letter that came in March from the Webster County Auditor? That letter contained the proposed levy rates, and the dates / times / locations of each individual taxing entity. That is why there was one meeting in the evening at City Hall, another in the morning at the Webster County Courthouse, and yet another the following month at the Fort Dodge Community School District’s Administration Building. All those meetings combined setting their own individual tax rate make up the entire levy rate. The current levy rate for homeowners in Fort Dodge is $45.54747 per thousand dollars of value.
Taxable Value multiplied by levy rate equates the total amount of property taxes due. Those property taxes are paid in two installments, due in September and March. Since you’ve read this far, you are in a better position to form your own opinion on the original question of this article.
The Fort Dodge portion of the tax levy rate went down. The Taxable value of the City as a whole increased. Using the values in the formula, the proposed property tax portion of the City budget increased, hence the last two sentences of the required mailed public hearing notice: “Reasons Proposed Property Tax exceeds the Current Property Tax: Increased cost of city operations.”
According to Realtor.com, the median listing price of homes in Fort Dodge is $164,900. The approximate taxable value of that median home would be about $78,214. After that said house is paid off, taxes are still due on the property for life. It still costs $3,562.45 annually to live in a paid off median home annually in Fort Dodge.
If you rent your property, does any of this affect you? Absolutely. In most circumstances, property tax increases are passed right along to the tenant in the form of rent increases. Have you ever wondered why rents go up with little improvements? This is why.
