At the September 8 meeting, the Rushford Council welcomed manager Kali Lentz from Smith Schafer, who provided the comprehensive annual financial report. While there were no glaring concerns, there also seemed little change from the previous year. The city received a clean report and positive news ending the 2024 year $51,000 under budget.
Last year, the approved budget and property tax levy was $1,138,631. This was the most significant piece of revenue for the year, although Local Government Aid was up, increasing to $705,947. Charges for services was the third highest revenue and revenue from Tax Increment Financing rounded out the total.
Expenditures continue to rise as the cost of goods, professional services, salaries, benefits, insurance, and more continue to do the same. Police Department expenditures were up $60,000 largely due to salaries and pay grade changes. Lentz noted it’s difficult to compare the expenditures of similar-sized municipalities due to many having contracted services. Fire Fund expenditures are being offset by revenues including those from township contributions. The Ambulance Fund saw a sizable jump in expenditures in 2024. This is a result of bringing up on-call pay to help maintain a healthy and well-staffed department, as well as equipment and facility upgrades. $94,000 of revenue to the ambulance service was a one-time financial boost from the state.
Given the scope of the work and the hiring of two new employees, the Public Works Department maintained a fairly flat expenditure trend, increasing just $14,424 due to salaries. Parks and Recreation, which includes the Rushford Aquatic Center, saw a $25,593 increase in 2024. Again, the bulk of this was increased salaries. Airport Fund expenditures saw almost no change in operations costs, but a large $721,126 in capital expenditures for the hangar project costs. There are both state and federal monies assisting with costs related to the municipal airport.
As for reserves, the unassigned/unreserved general fund balance, as a percent of fund expenditures, was 66%. It’s recommended to be between 72-74%, but Rushford’s percentage was intentionally brought down the last few years, staying above 91% and as high as 120% since 2017.
Lentz reviewed the reserve standing of the fire department, ambulance, airport, and library funds noting a healthy balance for all and noted no outstanding debts. As for debt service funds, the city currently has six outstanding general obligation bonds, totalling $5.6 million. There are eight outstanding enterprise revenue bonds for water and sewer utilities, all which are supported by ratepayers in utility funds and are being paid down in a timely manner. Five-year debt service requirements are roughly $1.3 million per year.
Lentz noted several areas of good news for the city including what she called “good planning” in the Capital Improvement Fund. The Levy Improvement Project Fund totaled $321,042 last year with funds dedicated to future maintenance and repairs as needed for the levee system infrastructure and equipment. Utility funds are seeing enough revenue currently covering operational expenses and debts.
In other news, attorney Mike Miller, who addressed the council four weeks ago on behalf of residents living in the area around the former Rushford-Peterson School District, was present at the September meeting to update the council. Miller indicated he’d discussed the concerns and request by his clients for Rushford to declare the property a nuisance with Mike Flaherty, the city attorney.
Miller acknowledged that the two disagreed slightly with the interpretation of a public nuisance. He stated to declare a public nuisance is a criminal action, a misdemeanor. While his clients could bring a criminal complaint, they would like to avoid that situation. In discussing other ways to address the issues, Miller indicated that the city currently has no nuisance ordinance. Most municipalities do and if enacted, it would provide the city more leverage in dealing with the issue and any other nuisance issues that may come along.
Miller also referenced state statute 117, which deals with eminent domain, particularly noting condemnation of blighted and abandoned properties. In statute 117.025, subdivision 5, the definition reads: “‘Abandoned property’ means property that: (1) has been substantially unoccupied or unused for any commercial or residential purpose for at least one year by a person with a legal or equitable right to occupy the property; (2) has not been maintained; and (3) for which taxes have not been paid for at least two previous years.”
“Frankly, I think what we see across the street meets the standard,” stressed Miller. “Before you conduct a condemnation, you have the right to conduct an inspection. If it is blighted… if it fits those definitions, the city has the right to demand remedial action by the property owner.”
Miller continued noting the property has no operating utilities and that there are environmental concerns, including a significant mold smell. “Obviously, the conditions persist there,” he added.
Mayor Terri Benson thanked Miller for his time and indicated the council and city staff would continue to look into the concerns.
During the reports portion of the agenda, City Administrator Tony Chladek indicated that American Legal Publishing, which is in the end stages of the ordinance codification process for the city, was given notice about a possible nuisance ordinance. He stated that their legal team is working on including common nuisance ordinances. Chladek also referenced the conducting of an inspection and stated the process is legitimate.
“An expert will come out and conduct an analysis,” said Chladek. “These things are difficult to process.” He added that the city could gain a very firm legal opinion by inviting the city attorney to a meeting. “For me personally, I think it would be beneficial for him to come and for us to ask questions.”
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