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Rushford Council looks at flood money distribution

Fri, Sep 14th, 2007
Posted in Government

RUSHFORD - At a special meeting Thursday, September 13, the Rushford City Council voted unanimously to enter into an agreement with SEMCAC to be the lead grant administrator on a Small Cities Development Program application for $1.4 million, with Pettitpiece & Associates, LLC, of Mankato, providing delivery assistance.

This grant application came to the attention of city staff recently, and the money is over and above the flood relief dollars recently approved by the Minnesota legislature.

The resolution deals specifically with the Small Cities Development Program, but the idea is that SEMCAC would continue on as the administrating entity for flood relief dollars as they become available, making for a sort of "front door, one-stop shop" for flood relief, according to council person Laura Deering.

Deering expressed the idea that appointing SEMCAC as the administrator of Rushford flood monies would allow the citizens of Rushford to control their own destiny and "the pace of what we do, who we work with" as southeastern Minnesota faces long-term recovery from the flood.

The deadline for the Small Cities grant application is October 1.

In light of the fact that approximately 65% of Rushford businesses and 25% of Rushford homes have been reassessed at a lower tax value since the flood, the council also adopted a resolution requesting property tax relief from the state. The tax relief would involve the state paying the difference between the original assessment value and the reassessed value for taxes in 2008.

The council discussed and approved a proposed tax levy, collectible in 2008, not to exceed $601,000. This figure represents approximately a 9% increase, or $51,000 more than last year's levy. However, the levy was not raised at all between 2006 and 2007. Block pointed out that averaging levies for recent years shows just a 3% increase from 2003 until 2007.

Since the $601,000 figure is the maximum possible, it is quite likely the final number may be lower. But having the maximum possible gives the city "room to consider things," according to Block.

The council set December 3, 2007, at 6:30 p.m. as the public hearing, with a possible continuance on December 10 to adopt the final levy.

The council heard updates on various flood-related issues and then discussed the fate of the municipal liquor store, which was a total loss in the flood. Block estimated that the store sustained $320,000 in damages, and that approximately $65,000 in stock was lost.

Manager Diane Jonsgaard was present to inform the group that she and Block were considering hiring a consulting firm, recommended by the Minnesota Municipal Beverage Association, to conduct a market analysis for the liquor store and determine what is feasible for the future. Since the flood, some citizens have expressed the idea that perhaps the liquor store could discontinue the on-sale lounge and only serve residents as an off-sale store. Jonsgaard did not hide her preference that both be continued.

"I'd hate to see that go," she said of the municipal bar.

Council person Nancy Benson asked whether a consulting firm was really necessary. Block answered that "if we're going to do any changes, now's the time."

Block reminded the group that in recent years, they'd taken up the issue of liquor store sales declining, and that last year, the city accountant had recommended the group watch the liquor store closely to make decisions about the future. The trend, however, for the past twenty years is that the store has made money and, as Jonsgaard pointed out, the city has borrowed funds from the liquor store in the past.

"We'll never get another opportunity to examine what's the best public policy for Rushford in terms of a liquor store. You'll never have this chance again," said Block.

Block also said that hiring a respectable consulting firm might be the best way to answer the opinion that Rushford doesn't need on-sale liquor.

Jonsgaard has received materials from two consulting firms that are recommended by the Municipal Beverage Association. Each would cost in the neighborhood of $5,000. Regardless of the recommendation, both Block and Jonsgaard highlighted the importance of carefully checking references for both firms to determine whether they've been a real value to other communities. The council approved the search for a good consultant.

The council approved a motion to set up a long-term flood recovery committee to oversee donated flood contributions. Laura Deering recommended that the group choose representatives from a variety of sources in the community, including business, school, agriculture, the faith community, and others. Deering added that this committee would have a difficult, yet important role to fill.

Attorney Terry Chiglo suggested the council appoint five members to the committee, and then let the committee select up to four more.

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