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Taxes won't skyrocket in Alexandria

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news Alexandria, 56308
Echo Press
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Alexandria Minnesota 225 7th Ave E
P.O. Box 549
56308

Alexandria residents shouldn't see much of a change in the city portion of their property taxes next year.

At its meeting Monday night, the Alexandria City Council unanimously voted to set the 2014 levy at $5.78 million, a 1.5 percent increase from this year's $5.69 million levy, which was 2.8 percent more than 2012.

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And it could go down from there. The budget includes about $104,000, roughly 1 percent of the total budget, to cover expenses that haven't been finalized yet. Compensation for city employees, for example, hinges on a study being conducted by Springsted Inc. of other similar sized cities. The study will be completed this fall.

Under state law, the preliminary levy that was set Monday can't be increased but could be reduced by the time the city adopts a final budget at its December 9 meeting.

The council is proposing a 2014 budget of $10.73 million, up 3 percent from this year's $10.39 million. Interim City Administrator Marty Schultz noted some highlights:

--The budget calls to hire one additional police officer and a combined position of city engineer/public works director. It also includes replacement positions for the city administator and an account technician, who were approved for early retirement incentives, as well as a replacement in public works.

--Funding for the Alexandria Senior Center, which was $10,000 this year, was eliminated. The center faces financial problems and at past meetings, council members said they didn't want to spend money on the center if it couldn't stay afloat.

--The street paving and reconstruction budgets were reduced from $140,000 to zero. The council is looking at alternative ways of funding those projects, Schultz said.

--As is the case this year, no money was set aside for equipment funds for streets, parks, fire department, police and the Runestone Community Center. Any expenses for equipment will be funded though equipment fund balances, the capital improvement fund or other "financing mechanisms" the council explores in the next six to nine months, said Schultz. The capital improvement fund was increased from zero to $95,133 and the information technology fund was increased from zero to $40,000.

--Because of a change in state law, cities are exempt from paying sales taxes on certain purchases. As a result, Schultz estimated that the city will save about $88,000 next year.

--On the revenue side, the biggest change is with local government aid from the state. It increased $258,839. Total franchise and delinquent taxes are budgeted to increase $82,500 to a total of $502,500. Revenue from licenses and permits, however, is expected to decrease $95,606, to a total of $442,800. This includes building permits, which are projected to total $350,000 in 2014, the same amount as this year.

--In 2013, the city's share of the property taxes for a typical residential property represented about 33.3 percent of the total property tax.

Schultz emphasized that the actual property taxes people pay are a function of several factors: market value, tax capacity and other taxing authorities.

A public hearing was held before the council voted on the levy but no one spoke.

Council member Virgil Batesole, a budget committee member, said he wants to lower the levy increase to zero and will vote against the levy in December if the council doesn't reduce it by then.

Council member Roger Thalman said that the preliminary budget should be able to cover the financial unknowns, such as employee salaries, and help the city gradually build up its equipment funds. Council member Owen Miller agreed. "We're paying now for some of the zero levies we've had in the past," he said, noting the deteriorating condition of roads.

In other action from Monday's meeting, the council:

--Honored City Administrator Jim Taddei for 35 years of service to the city. Monday was his last council meeting. Mayor Sara Carlson presented Taddei with a plaque honoring his loyal and dedicated service to the city through a total of seven mayors -- Vern Bisson, Paul Nelson, Dorothy Kobs, Karl Glade, John Perino, Dan Ness and Carlson. Nelson and Ness attended the meeting to congratulate Taddei. "Thank you very much," said Taddei, who wasn't expecting the fanfare. "It's been my honor to serve this community rather than the other way around."

--Was informed by City Attorney Tom Jacobson that having a council member who owns rental property in the city debating and voting on issues that involve the Alexandria Housing and Redevelopment Authority (HRA) is, in his opinion, a conflict of interest. The council asked Jacobson to look into the matter after Batesole objected to the HRA's proposed levy increase request at the last council meeting. Jacobson said that he found a precident in a Minnesota Supreme Court case that determined a township board member had a conflict of interest by voting against a bar's liquor license renewal because he believed it would devalue his property located across the street from the bar. Jacobson recommended that Batesole should refrain from voting and debating HRA issues at council meetings.

--Received an update on the downtown sidestreet projects on 5th and 7th Avenues. The project is taking longer than expected; City Engineer Tim Schoonhoven said the contractor, Mark Lee Excavating, is about two weeks behind on the work schedule. The delays are frustrating to downtown businesses, Schoonhoven and Mayor Carlson said. Read more about this issue in Friday's Echo Press.

--Directed city staff to draft an ordinance that would create two new license categories for alcohol: brewer taproom and small brewer licenses. Although there is nothing being proposed here yet, the city received a request from two individuals to adopt the ordinance that would allow off-sale malt liquor, said Schultz.  The Legislature revised statutes concerning these licenses in the 2013 session to allow cities with municipal liquor stores to grant these kinds of licenses. Willmar, Marshall and Brainerd recently enacted such ordinances. Thalman, a member of the city's legislative committee, said these kinds of businesses cater to a different customer than the city's liquor stores draw. He said it could help attract more people into the area who are planning a vacation.      

--Approved plans for Someplace Safe's seventh annual "Taking Steps Against Domestic Violence Walk" on Tuesday, October 15. It will start at 5 p.m. at the Douglas County Courthouse and end at Calvary Lutheran Church in Alexandria. There will be a speaker, free T-shirts and food. Also, on October 16, Someplace Safe will host its 13th annual Domestic Abuse Awareness Luncheon at Arrowwood from 11:45 a.m. to 1 p.m.

--Approved the bids for the final segment of the extension of the city waterline to the phase four, part one, orderly annexation agreement with Alexandria Township. The project in Van Avenue, the northern tip of Government Point Road, will cost $30,233, which brings the total cost of the waterline work to just over $5 million. The city is covering $3.54 million of the cost and the rest will be assessed against the benefitting property owners on a delayed basis. An assessment hearing is scheduled for October 15 at City Hall.

--Authorized the city administrator and mayor to sign a pending grant offer from the Federal Aviation Administration to build a new large aircraft hangar at the Alexandria Airport. The total cost of the project is about $760,000. The FAA is covering nearly 90 percent of the cost. The city's share amounts to $83,717. The city expects to recover that expense by renting out the hangar. Batesole opposed the authorization. He said that the council shouldn't delegate its authority to others. He added that he fully supported the project.

--Approved a new right-of-way map for Kenwood Drive, which will soon be connected to the sanitary sewer system. The road is at least 50 years old and property lines and right-of-ways haven't been properly identified, said Schoonhoven.

--Referred a encroachment permit request from Brad Horning of 1611 Cedar Street to the planning commission. Horning wants to add 15 feet onto the back of his detached garage, which rests slightly into Dean Melton Fillmore Park.

--Approved the following charitable gambling licenses: Voyager Parent Association to conduct bingo for an October 25 event and ABATE of Minnesota Chapter Freedom Riders to sell raffle tickets at an April 12, 2014 event.

--Was informed that CenterPoint Energy wants to renew its natural gas franchise agreement with the city, which expires on November 25, 2013. Thalman said the city should put something in the agreement that would make CenterPoint more accommodating to requests from residents to expand services in their part of the city.

--Referred a street lighting request to Alexandria Light and Power. Fifteeen residents in the neighborhood of North McKay Avenue between Oak Knoll Drive and Discovery Middle School requested the lighting for the safety and security of pedestrians, bicyclists and vehicles in the area.

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Al Edenloff
Al Edenloff is the news and opinion page editor for the Echo Press. He was born in Alexandria and lived most of his childhood in Parkers Prairie. He graduated with honors from Moorhead State University with a degree in mass communications, print journalism. He interned at the Echo Press in the summer of 1983 and was hired a year later as a sports reporter. He also worked as a news reporter/photographer. Al is a four-time winner of the Minnesota Newspaper Association's Herman Roe Award, which honors excellence in editorial writing.  
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