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Chatfield 2013 final levy increase less than two percent

Fri, Dec 14th, 2012
Posted in Chatfield Government

By Karen Reisner

During the Chatfield city council’s last meeting of 2012, councilors approved the final 2013 levy and budget. City Clerk Joel Young detailed the numbers for the city. The preliminary levy had been approved in September at an increase of just less than five percent. Young explained that changes to the preliminary budget, consisting of cost reductions and revenue increases totaling $34,847, allowed the 2013 levy increase to be reduced to 1.95 percent. Reductions in the wage increase for city employees to 1.9 percent, from three percent contributed to the savings. One other reduction was managed through reduced swimming pool expenses. Increases in revenue from both the swimming pool and an increase of police aid from the state also contributed to making up the difference.

Even with the uptick in the levy, most private residences will experience a decrease in next year’s property taxes. Young noted that overall real estate value for the city saw about a $3 million loss in value, mostly from residential property values. When some classes of property go up in value and others go down, there is a shift in the tax burden. Business and industrial properties will likely experience a higher increase in their total property taxes than the city’s levy increase of 1.9 percent. County, school district and city property values and funding is all baked into the cake.

The city strove to “limit the financial burden on residents during this time of economic stress.” Young noted that costs of doing business continually go up. He maintained that the city’s goal is to maintain strong safety departments and continue to invest in infrastructure and facilities, while protecting the city’s strong bond rating. The main cost drivers in the budget included personnel costs, fire department services, library services, EDA allocation, and the general fund subsidy to the sanitary sewer. Center for the Arts funding did not contribute to the levy increase. Young said the Center does have a declining fund balance and use of the facility continues to increase.

No additional debt was issued by the city in 2012, but refunding of the 2008 series resulted in interest savings of $328,000 over the life of the bonds. The reduction of $17,000 per year in debt service payments saved 1.4 percent from being added to the levy.

There was no comment from the public during the public comment period on the 2013 budget and levy.

The council debated whether $20,000 should be allocated to the EDA to support the effort to grow new businesses. The funds were requested by the EDA as a way to put together property to redevelop the Twiford Street area. This funding made up 1.7 percent of the levy increase. Councilors considered whether or not they should allocate these funds. No allocation would keep the levy increase nearly flat.

Councilor Paul Novotny explained his support for the allocation was only for one year. Councilor Russ Smith said he supported including the funding in an effort to step toward the goal of getting more businesses in town, adding “plant a seed and it will grow.” Mayor Don Hainlen agreed that more resources are needed to improve opportunities. Councilor Josh Thompson was in favor of helping development, but suggested they need a long-term plan. Like Novotny, Thompson questioned the allocation becoming a yearly expense. He added that the city shouldn’t be in the business of buying property and suggested they also need dedication and work in the downtown area. Hainlen said they should look at it on a year-to-year basis. Councilor Dave Frank said it will take time to see any results. Councilor Ken Jacobson noted he had planned to ask to remove the allocation, but said the allocation will indicate to the city’s businesses that the council is concerned. No action was take to remove the allocation to the EDA.

The operating budget and tax levy were approved with the 1.95 percent levy increase. The total budget increase for 2013 will be $23,451. A resolution was adopted with the pay grid adjustment of 1.9 percent. The upward adjustment is consistent with the Chained Consumer Price Index for All Urban Consumers which recently published a 1.9 percent increase in prices.

Other Business In Brief

•Action on plans for 2013 improvements to Fourth, Fifth, and Sixth Streets on the blocks east and west of Main Street was postponed until January when the new council meets. The plans would include street surfacing, curb and gutter, sidewalk/ramps, and repairs to a few storm sewer catch basins.

•The council approved the city’s participation in a Health/Resource Fair which will be sponsored by Help Our Neighbors and Olmsted Medical Center on Saturday, January 26 from 10:00 a.m. to 2 p.m. Expenses for the city are not to exceed $200.

•The second consideration and publication of Ordinance #406, Fees and Fines, was approved.

•Approval was given for the firefighters to be the official sponsor of the Chill Fest Polar Plunge to be held January 26. Dean Irish and Jay Hanson are organizing the plunge with benefits going to St. Jude Children’s Research Hospital.

•The generator is in place on city hall. It was to be tested on Tuesday, the next day. The council approved a payment of $51,474.90 to Southeast Electric, Inc. This is 93 percent of the total cost.

•This was Josh Thompson’s last council meeting. He said it has been a pleasure to serve, a great experience, and acknowledged that it was harder to leave than he had expected.

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