The Clinton Herald, Clinton, Iowa

Local News

May 22, 2013

City forced to cut $1.1M from budget

CLINTON — The city of Clinton is scrambling to cut more than $1.1 million from next year’s budget because of a settlement that was reached between the Clinton Board of Review and Archer Daniels Midland.

As part of a settlement that ADM and the Clinton Board of Review reached earlier this month, ADM will receive more than $2.5 million in tax credits from the city, county and Clinton School District because the agency overpaid property taxes on its cogeneration facility, corn processing plant and bio-processing plant in the 2010 and 2011 assessment years.

While the city will be able to pay off its portion of the tax credits for the bio-processing plant and the corn plant, which amounts to roughly $212,000, in fiscal year 2014, the credits for the cogeneration facility will impact the city into fiscal year 2016. The cogeneration facility’s lowered valuation will cost the city around $788,586.

During the Internal Operations Committee meeting Tuesday, Finance Director and interim City Administrator Jessica Kinser told committee members the city’s portion of the tax credit paired with the agreed-upon assessments of ADM’s facilities means the city’s fiscal year 2014 budget will be impacted by approximately $1.1 million.

At-Large Council member John Rowland asked how the assessment, particularly of the cogeneration facility, could have been lowered so drastically. The facility was originally assessed at $77 million, but the settlement sets its value at $7.6 million for the 2010 assessment year.

“Is the assessor qualified and trained to do the assessments of properties such as ADM and other large industrial sites? Because again, back to that discrepancy, how could those assessments be off so far?” Rowland asked.

The property in question was labeled a utility plant in 2008 and was thus exempt from property taxes in 2009.

However, City Assessor John Moreland and other city officials protested the tax-exempt designation.

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