Watertown Council Advances 2026 Tax Levy, Aligning with State Law

Red house icons on coin stacks spell "PROPERTY TAX" in chalk on a blackboard. Watertown SD and Northeast Radio SD logos in corners.

Northeast Radio SD News - Watertown, SD - The Watertown City Council has given the green light to the 2026 property tax levy, with a unanimous vote. The Finance Officer is now set to certify the amount to the Codington County Auditor. This decision came after the second reading of Ordinance No. 25-13 during the September 15, 2025, council meeting.

City Manager Alan Stager explained that the levy aligns with a recently passed state law that ties property tax increases to inflation and growth from new property. The 2026 levy will result in a total increase of $220,337 for the city's General Fund, for a total of $4,679,000.

Despite the increase in the total tax amount, Stager noted that the mill levy—or the dollar amount paid per $1,000 of assessed property value—is anticipated to decrease by about 9% from 2025. This means that while the city is collecting more overall tax revenue, the rate for individual properties is expected to go down.

Councilman Michael Heuer raised questions about the impact of the new state law on the city's budget and its ability to maintain essential services. Stager responded that the city of Watertown has historically and voluntarily kept its tax levy in line with what the new state law now mandates, so the change is not expected to have a significant impact on future city operations, “at this time.” He also mentioned that the city can still use general obligation bonds to fund major projects, though the last time this was done was for the Event Center.

The motion to approve the ordinance was made by Councilman Doug Allen and seconded by Councilman Dan Schutte. The vote was unanimous. Councilman Kyle Peters was absent from tonight’s meeting.