City administrator suggests grant to ease higher property taxes for newly annexed residents
By Gabby Landsverk, Staff Writer
The 2015 city budget and house and redevelopment authority levy was adopted at Monday’s City Council meeting, but not before a public hearing addressed concerns from residents regarding higher property taxes for those living in areas recently annexed by the city. City Administrator Dan Vogt explained that although the tax rate has been slightly lowered, newly annexed residents will be paying more.
In a sample property tax comparison Vogt presented, taxes on a newly-annexed residential home increased by 67 percent. One resident reported a $1,200 increase in property taxes, said Vogt. By contrast, the tax rate on homes already in the city decreased by .4 percent.
Vogt acknowledged that the sharp increase in property taxes had generated a considerable amount of concern among residents. “I know it’s a substantial issue,” Vogt said. “For property owners that are in the newly annexed area — what can they do? There’s a substantial increase.”
Vogt suggested those affected by the annex apply for a state program called the Special Homestead Credit Refund. The refund is available to homeowners whose taxes increase by 12 percent or more, totalling at least $100. Vogt estimates that many owners of newly annexed properties fit that description. Qualified applicants can receive a refund of up to $1,000.
When asked whether the refund would be available annually, Vogt clarified that taxpayers were only qualified for a refund for the year their taxes increased, so any subsequent refunds would need to be justified by a further increase in taxes.
The annexation also resulted in a lower levy increase than expected. Due to the increase in properties within city limits, the levy could have been raised as much as 13.75 percent without increasing the tax rate, according to Vogt. The 2015 levy approved by the city council in September and adopted Monday was 9.99 percent higher than in 2014.
Vogt said that projections indicate a significant reduction in city debt, and therefore the debt levy, by 2016.
“2016 (is) a pretty substantial drop-off (in debt)…it’s quite a bit of money,” Vogt said.
The 2015 budget includes an increase to the Street Improvement Fund, as well as a total of $54,300 allocated for a full-time city administrator for part of 2015 and the search for qualified candidates, and $65,000 for an additional full-time police officer.
Vogt said the increase in the budget does not equal an equivalent increase to the levy because just over half the city’s funds in 2015 will be provided by the state through local government aid funding.
Little Falls City Council Briefs
In other business Monday, the Little Falls Cities Council:
- Voted to approve the purchase of new trees to replace those that have died, at the recommendation of the Park, Recreation and Tree Board. The Council will match up to $1,000 in donations for the purchases of the new trees. Public Works Director Greg Kimman estimated that amount will fund the purchase of 56 new trees, to be planted on boulevards and parks throughout the city;
- Received rules and regulations for Great River Arts’ GRA public access television station The station will air City Council meetings and church services, as well as videos submitted by the public that adhere to GRA’s guidelines.. The studio also has a cooking show in the works;
- Unanimously voted to move forward on a feasibility report to assess maintenance costs for water and sewer services along First Street Northwest. Kimman described the extent of disrepair in this area as “alarming,” and said proper functioning of water systems will likely be disrupted if the city fails to make repairs; and
- Voted to attempt to acquire the vacant Clark Jiffy Lube gas station on First Street at the recommendation of the Economic Development Authority. Because the property is tax forfeit, the city may be able to acquire it from Morrison County at no cost. “It’s been an eyesore in the community,” Alderman Brian-Paul Crowder said, to the consensus of the rest of the Council. If the property is acquired, underground tanks may be removed and an environment assessment conducted to determine the need for further clean-up. Grant funding may be available for the project
. The Council’s next meeting is Monday, Dec.15 at 7:30 p.m. at City Hall.