The Ames City Council met Friday to overview the $332.3 million fiscal year 2025-2026 budget, including property tax and utility rate increases.

Property tax rate

According to city documents, property owners in Ames will see a 1.59% increase in the tax rate, from $10.09 to $10.25 per $1,000 of taxable property. The increase is partly due to a reduction in state funding, mostly the phase-out of “backfill” payments, which means the city loses $195,000.

On average, 

  • Homeowners will pay an estimated $18.96 more per $100,000 home value.
  • Commercial properties will see a $0.53 increase per $100,000.
  • Industrial property taxes will rise by $24.97 per $100,000.

“We’ve done what we think is prudent, what we think we need to generate sufficient funds to provide the quality of services that you and the citizens are asking for,” said City Manager Steve Schainker.

Utility tax rates

Electricity rates will increase by about 1.5%, adding about $1.20 monthly to the average utility bill to fund renewable energy initiatives. Over the next four years, Ames intends to add 50 MW of wind power, increasing renewable energy use from 15% to 31%

Water will receive a 3.5% increase to support system maintenance and capital improvements, including a new chlorine monitoring system to enhance water quality.

Sanitary sewer will increase by 5.5% to cover biosolid disposal costs and upgrade aging infrastructure. Stormwater and garbage collection fees will remain the same.

Public safety

The Ames Police Department will receive $132,000 for the Alternative Response for Community Health (ARCH) program, which pairs mental health professionals with EMTs to respond to crises.

City documents state, “By responding with the ARCH team rather than with our law enforcement personnel, we are able to provide trained professionals equipped to de-escalate the situation, stabilize the crisis, and provide mental health support.”

The Ames Fire Department is adding a new firefighter position to prepare for a fourth fire station in Ames gradually. 

The animal shelter will also hire additional staff in anticipation of a new, larger shelter opening in late 2026.

Budget hearings will begin Tuesday and continue until Thursday.



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