City keeps its taxes from going up

Published 9:44 am Wednesday, December 14, 2011

Despite a projected $700,000 decrease in revenues in 2012, the Albert Lea City Council on Monday approved no increase in its local tax levy for 2012.

The council had approved a proposed 2 percent — or $105,000 — levy increase in September.

“I’m really very proud of the councilors,” 3rd Ward Councilor Ellen Kehr said. “We knew what we had to do.

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“We’re doing what we can on the city level to keep our taxes where they need to be.”

Albert Lea City Manager Chad Adams said any increases that people may see in city taxes during 2012 will come as a result of the elimination of the state’s homestead market value credit, or state-paid reduction to homeowners in the amount of taxes due. With the elimination of the credit, the state instituted a homestead market value exclusion, which reduces the value of a home subject to taxation. This ultimately reduces tax capacity and causes a shift in the tax structure.

Adams said though homes valued between $50,000 and $75,000 may see no increase or even a decrease in city taxes, homes valued between $100,000 and $400,00 can expect increases, along with commercial, industrial and residential nonhomestead properties.

Albert Lea Mayor Vern Rasmussen thanked city staff for making revisions in the budget to allow the city to do its part to keep taxes from going up even more.

Specifically, the total city levy was approved at about $5.23 million, including $4.62 million for the general fund operating levy and about $607,000 for the debt service levy.

Adams said the decreases in revenues were made up by maximizing equipment and facility funds, utilizing grant funds for equipment, updating the capital improvement plan and creating a financial management plan.

Expenditures have been decreased by not backfilling vacancies, utilizing a portion of the city’s contingency fund that has not been used in the last couple years, deferring some projects and saving on utilities.

The budget was approved at $13.76 million, which is a decrease of almost $65,000 from the original proposed budget in September. This is down from the more than $14 million budget in 2011.

Adams said the goal of the budget was to maintain levels of service without layoffs.

Forty-one percent of the proposed budget will be dedicated to public safety, while public works will receive 19 percent and culture and recreation will receive 24 percent.

In other action, the council:

• Authorized a grant application to the Minnesota Department of Employment and Economic Development for public infrastructure grant funds. The application proposes a $400,000 project with the city matching 50 percent.

The funds would go for the parking lot improvements for the potential project with Mayo Clinic Health System and the Freeborn National Bank Building.

• Approved the 2012-16 capital improvement plan for the city.

For 2012, projects total just over $7 million. They include installation of a new roof at City Hall, various street overlays, the downtown streetscape project design phase, and Ninth Street reconstruction, to name a few.

• Adopted the 2012 fee schedule.

• Accepted a $2,000 donation from Mutaz Wazwaz, owner of the Tobacco Store, 2312 Hendrickson Road, for the purchase of defibrillators.


What does your city tax go for each month?

• General government: $3.61

• Public safety: $13.27

• Public works: $6.03

• Parks, recreation, library: $7.66

• Conservation and development: 35 cents

• Debt service (roads, etc.): $1.31

• Miscellaneous $1.10

Total monthly city tax $33.33

Total annual city tax $400


— Numbers based on a $100,000 home