City approves 2.87% total levy increase

Published 7:06 am Tuesday, December 15, 2020

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The Albert Lea City Council on Monday approved a 2.87% total levy increase for 2021, which was down about 5% from the preliminary levy approved in September. 

The council in September started out with a total preliminary levy of 7.94% — made up of an 8.37% increase in the general fund operating levy and a 6.78% increase in the debt levy. The council ultimately approved a 1.42% increase in the general fund levy and a 6.78% increase in the debt levy. The debt levy typically covers the cost of the city’s road projects. 

Finance Director Kristi Brutlag said city department heads, finance staff, two City Council members and new City Manager Ian Rigg went through the budget in-depth and reduced the budget by about $330,000. 

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Some of the reductions included a decrease in personnel costs by about $290,000. This included reducing the wage adjustment from 2% to 1.25%, pushing back the hire date of the new assistant city manager to Oct. 1 and having a smaller increase than expected in health insurance costs by about $75,000. The budget now also includes final salaries and benefits.

Brutlag said there was a reduction in some revenues: $23,000 in MSA maintenance and $46,000 in overhead charges to utility funds. 

A reduction in expenses over $5,000 included:

  • $5,000 in dues, subscriptions and training for the city manager
  • $12,000 in building maintenance charges for City Hall
  • $17,000 for training and travel for the Fire Department 
  • $10,000 for expert and professional services for the Engineering Department
  • $10,000 for snow and ice removal (mainly from fuel savings)
  • $25,000 for reduction in building maintenance at City Arena and for pushing back the purchase of a new speaker system to the building maintenance fund.
  • $5,000 reductions in transfers to the IT capital fund and Senior Center fund. 

Brutlag said the total levy increase is about $187,000, with about $68,000 of that going toward the general fund levy, which was set at $4,826,000, and about $119,000 of that going toward the debt levy, which was set at about $1,881,000. 

She said a person with a $100,000 home that saw no increase in value in 2021 would have their taxes go down by 56 cents because of increased tax capacity across the city.

She showed a graph comparing levy increases in other similar entities. She said Austin ended up with a 4% levy increase, Faribault with a 4.7%, Mankato with a 2.33%, Owatonna and Waseca with 3%; and Winona with a 5.5% increase.

The council approved the budget at about $16.877 million, an approximate 0.72% increase over 2020.

Third Ward Councilor Jason Howland thanked staff and department heads for their work on the budget and said everyone was open and receptive during the budgeting process. 

He noted the city hasn’t had to increase its general fund levy for nearly a decade, while the same can’t be true for other cities throughout the state. Ultimately, however, an increase was inevitable with inflation and rising health care costs, he said. 

Second Ward Councilor Larry Baker said he has had several people asking him why their assessed values of their properties went up so much and asked if someone from the Freeborn County Assessor’s Office could speak to the council about the increases in property values. 

Sixth Ward Councilor Al Brooks read a statement from Daniel and Joyce Purdy, who saw a 48.6% increase in their values after repairing their home from storm damage. 

In other action, the council:

  • Approved a 4% increase in sewer rates and a 5% increase in water rates. 

Brutlag said the city hasn’t had a sewer rate increase since 2017. 

With the increases, the average residential user of about 6,000 gallons of water will see a monthly increase of about $2.81 in their utility bill, she said. 

Increases come in preparation for several large projects the city has slated in the next few years, including the replacement of the central water tower and upgrades to the city’s wastewater treatment plant. The city recently underwent a study of the city’s water and sewer rates. 

She showed average costs of utility bills in other communities, which for many includes a storm water fee. Albert Lea’s is about $64 a month, Austin’s is $72.50, including a storm water fee; Fairmont’s is about $110 a month; Marshall’s is about $102 a month; New Ulm’s is $76 and Owatonna’s is about $58 a month.

Austin’s rates are also expected to see a significant increase as it pays for upgrades to its wastewater treatment plant. 

Howland, who ultimately voted in favor of the increases, said while he understands the need to pay for infrastructure such as the city’s new water tower, he said the council has continued to increase the water rates since he started on the council and questioned how long these increases would need to continue. 

  • Approved the fee structure for other fees for the city for 2021. Brooks voted against, saying he felt some of the fees were excessive, and there were some he did not think should even be on the list. 
  • Approved a $109,000 levy for the Albert Lea Housing and Redevelopment Authority, which is the same as in recent years. Those funds will go toward brick stabilization at Shady Oaks, the organization’s Section 8 operating fund and its public housing operating fund.   
  • Approved the city’s capital improvement plan for 2021 through 2025. Brutlag emphasized the plan could change based on need or availability of resources. Projects still have to go through typical approvals. 

In 2021, projects include the central water tower replacement, the preliminary phase for the wastewater treatment plant upgrades, the Blazing Star Landing soil contamination project, the 2021 street reconstruction project and the Snyder ball field improvements. 

  • Adopted the water, sewer, solid waste, Senior Center and airport budgets for 2021. 
  • Voted to extend the city’s emergency declaration that has been in place since March surrounding COVID-19. The declaration will be in place through Jan. 14 unless the governor’s peacetime emergency expires or is rescinded. 

First Ward Councilor Rich Murray said small businesses are suffering across the city, county and state.

“Every day, more and more of them are permanently closing, never to open again,” Murray said. “It’s time for the governor to open up the gyms and open up the restaurants so that the restaurants in our community and other communities across the state can make a little money and have a little holiday cheer themselves.”

  • Called a public hearing for Jan. 11 for the street reconstruction project for 2021 on Edgewood Avenue, St. Peter Avenue, Stanley Avenue and Ulstad Avenue. 
  • Awarded bids for the yearly chemical supplies, gasoline and diesel fuel. The low bids were submitted by DPC Industries Inc. of Rosemount and Advantage FS of Waverly, Iowa. 
  • Approved a variance for construction of a 30-by-30-foot accessory structure with a reduced front yard setback for Ron Ericksmoen.
  • Accepted donations from Riverland Community College of metal snowflake holiday sculptures that will be placed in the large flower pots along Broadway. The snowflakes are valued between $1,500 and $2,000. The project was in coordination with the Albert Lea Convention and Visitors Bureau.