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Tax hearing turns testy

Homeowners in Alexandria can expect a slight decrease or increase in the city portion of their tax bills next year, depending on their property values.

Following a "truth in taxation" hearing Monday night, the Alexandria City Council approved a 2018 levy of $6,725,676, a 4.01 percent increase from this year's levy. The levy matches the amount the council approved back in September.

No one from the public spoke at the hearing. Besides city staff, the media, the council and the mayor, only four people from the public were there.

Virgil Batesole was the only council member who voted against the budget and levy. He said the city can't continue to raise taxes 4 percent or more every year. Batesole thanked the budget committee for its work but said the council "did not do a good job" and should have reduced the budget by at least 3 percent.

Mayor Sara Carlson asked Batesole what should be cut from the budget. Batesole said he had ideas and had earlier told the council about them.

"I don't remember you offering any ideas," said Carlson, who was a member of the budget committee. "But I will let that go tonight."

Council member Todd Jensen said he expected Batesole to "grandstand" at the meeting, adding that Batesole is up for election next year. Jensen defended the budget, saying that city expenses don't go down and the city has to pay for those price increases.

During the presentation of the budget, City Administrator Marty Schultz stressed that although the levy is increasing 4.01 percent, most taxpayers will not face the same jump in taxes. That's because growth and new building activity increased the city's overall tax base by 4.45 percent, which softens the impact.

If property values remain at the same levels, most taxpayers will see a slight decrease in city taxes — 0.45 percent. If property values rise 3 percent, the city's portion of property taxes will increase 2.54 percent.

Schultz provided a few examples:

• City taxes on a home with a taxable market value of $150,000 that doesn't increase in value will decrease from $613.96 to $611.50.

• City taxes on a home with a taxable market value that increased 3 percent, from $150,000 to $154,500, would increase from $613.96 to $629.85.

• City taxes on commercial property valued at $300,000 would decrease from $2,148.85 to $2,140.26.

Schultz provided a breakdown of how the $611.50 in city taxes listed in the first example would be spent: A total of $358.52 would go to the general fund. The rest would go to police ($121.17), administration ($61.08), parks ($44.66), legal ($39.26), general government ($21.31), assessor ($16.66), mayor and council ($12.01), fire protection ($11.96), human resources ($7.37), recreation ($7.36), elections ($2.96), engineering ($2.73), airport ($2.68), Runestone Community Center ($1.87), community development ($1.70), animal control ($1.59), Alexandria Senior Center ($1.14), emergency management (75 cents) and insurance damage claims (27 cents).

The tax outlook is brighter for those with commercial or industrial property because their values stayed fairly flat, Schultz said. Also, the state Legislature made changes exempting the first $100,000 of their property value exempt from taxes. That will result in some owners seeing tax decreases of 20 percent or more, he said.

The council approved a 2018 general fund or operating budget of $9.28 million — a 3 percent increase from this year. The city's total budget increased 2 percent, to just over $12 million.

As in the past, the biggest item in the general fund is for the police department — $3.14 million. Other general fund items of $100,000 or more included general government ($2.5 million), street department ($1.29 million), parks ($718,920), Runestone Community Center ($604,605), fire protection ($403,168), building department ($287,310) and airport ($176,880).

The budget, Schultz said, reflects four priorities:

• Street paving. The budget increased from $75,000 to $125,000.

• Street reconstruction. The budget continues to set aside $50,000 to fund those projects.

• Management of general fund reserves. The city has enough reserves to keep the city operating for five months, which is recommended by the state.

• Moderate levy increases of 3 to 5 percent. This helps the city avoid large double-digit increases in the future.

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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