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Council runs the budget numbers

By Staff | Oct 5, 2009

Blue Earth City Administrator Kathy Bailey

The Blue Earth City Council has been playing a real numbers game lately – and they are not done yet.

At issue is the 2009 budget and property tax levy.

Although they have already sent a proposed property tax levy to the county auditor – a 16 percent increase over last year – that number will not be what the final levy increase will actually be.

In fact, the maximum amount of tax levy the city can legally set has changed several times since the council made that proposal.

This year’s actual levy was $1.128 million. The levy amount sent to the county auditor last month, for 2010, was $1.308 million.

However, the preliminary budget shows a local property tax levy needed for 2010 of $1.498 million.

Confused? There is more.

City Administrator Kathy Bailey says the state is actually going to come down with a mandated levy limit for the city of Blue Earth that will be $1.229 million.

That number is just over $200,000 more than the current levy. It is also $269,000 less than the amount needed for the 2010 budget.

On Monday night four members of the council attended a budget work session to try to slash the 2010 proposed budget to get it into line with what the income next year will actually be.

On the chopping block were a variety of items, ranging from a police officer position to a road grader.

The council discussed not filling both a police and public works employee, a savings of $86,000.

Postponing the purchase of a road grader would save $180,000, the council learned.

One way to save would be to bond for equipment purchases, such as the grader, a street sweeper, and a sewer vac. The city could save $18,000 by refinancing several other bonds as well, Bailey says.

Not purchasing a new four-wheel drive vehicle for the police department would save $35,000. Councilman Rick Scholtes called buying a four-wheel drive vehicle, “a waste of taxpayer money.”

“It isn’t needed,” he says. “It makes no sense to me.”

Also on the possible cut list was the $12,000 the city adds to the firemens’ relief association. However, Councilman Glenn Gaylord said he favored paying into the fund in order to keep getting volunteers.

“They are not paid that much,” Gaylord says. “We need to do something for them.”

He suggested raising some funds for the department by charging $500 for each fire call. Currently city residents are not charged any amount, and rural residents are charged $250.

Insurance would cover the homeowners cost, Gaylord says.

Another $24,000 could be saved next year if the wage increase for city employees was kept at 1.5 percent, instead of the 3 percent increase proposed in the budget.

Other items on the discussion table included;

– Using a donation from Vera Steinberg to pay for capital improvements at the library, saving $6,000.

– Transferring $50,000 of liquor store profits to the general fund.

– Not increasing the street improvement fund more than the original annual amount of $160,000. Savings would be as much as $12,000.

– Bond for improvements to the airport (credit card fuel service, generator) and the new tornado sirens for the city.

Since it was a work session, and not a regular meeting, all of the suggestions were just that – suggestions.

Most of the council members present seemed to be comfortable with shooting for a three percent levy increase for 2010, not the previously proposed 16 percent.

Councilman Gaylord suggested that all of the employees be asked for any ideas they have on what could be cut to trim the budget.

“We could ask them to be creative, and see what they come up with,” he concluded.