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BE levy hike at 3.5 %

By Staff | Dec 10, 2017

The Blue Earth City Council handled getting their 2018 budget finalized and the tax levy set during action at their work session, regular meeting and special Truth In Taxation Hearing all held last Monday night.

When it was all said and done and voted on, the council had balanced the budget and had made their goal of just a 3.5 percent increase in the property tax levy for next year.

But, it was not easy.

Discussion on the budget and tax levy started during the work session, held the half hour before the regular council meeting at 5 p.m.

The budget as presented at that time resulted in a 4.1 percent increase in the tax levy.

City administrator Tim Ibisch presented a list of areas in the budget he said “had wiggle room” and could be altered (lowered). Among those were the Economic Development Authority budget for demo of commercial buildings, and an update of the GIS system in the engineering budget, and others.

Mayor Rick Scholtes said he had a list of items that could be cut or lowered that would result in getting to a tax levy increase of 3.5 percent.

Besides cutting the EDA and GIS funds, he proposed also cutting the fire relief association donation from $12,000 to $2,000, lowering the Public Works budget by $20,000 and funding the 14th Street ball diamond restrooms with monies from the liquor store fund. No decisions were made during the work sessions, as they cannot be.

At 6 p.m. the council held its Truth In Taxation Hearing, where administrator Ibisch went over the proposed 2018 budget. The only members of the public present were four members of the Blue Earth Fire Department.

After Ibisch finished his presentation, Mayor Scholtes reminded the council that no cuts as discussed in the work session had been made, the tax levy increase was at 4.1 percent and he asked what direction the council wished to go.

Councilman Glenn Gaylord said that whatever else they did, he did not want to see the cut made to the $12,000 donation to the firemens’ pension fund.

He suggested taking the full $12,000 donation from the liquor store fund, thus removing it from the part of the budget funded by the levy.

“We have always made this donation and it is in support of our firemen,” Gaylord said. “It is important that we do so.”

Mayor Scholtes disagreed.

“We do support our firemen and we just showed that by raising the amount they get in their pension from $1,900 up to $2,300 per year,” Scholtes said. “And they have the money in their pension fund to do cover that amount.”

Councilman Dan Warner also said that cutting the $12,000 down to $2,000 for one year will not impact the pension fund and would help balance the budget.

“And I am sure these gentlemen will be back here next year reminding us we cut it and need to reinstate it,” Warner said.

However, Gaylord made the motion to keep the $12,000 in the budget and to fund it with liquor store money.

Councilman John Huisman seconded the motion.

“Cutting this would be short-sighted,” Huisman said. “We need to take care of these people. They are volunteers and are not paid like police officers, and still are at risk in a dangerous job.”

The vote to keep the donation at $12,000 and use liquor store funds just barely passed at 4-3, with Scholtes, Warner and councilwoman Wendy Cole voting no. Gaylord, Huisman and councilmen Russ Erichsrud and Marty Cassem voting yes.

The council did make the other proposed cuts, but also added in a couple of items, including funds for a hockey rink and improvements at the pool.

Eventually their manipulations of the budget got the tax levy increase right at the goal of a 3.5 percent hike over last year’s amount.

The total of the 2018 tax levy was officially set at $1,488,961.56.

Ibisch called it a fiscally responsible budget.