The Delano City Council Tuesday, Dec. 4, approved a final $2,649,780 property tax levy and a final General Fund budget of $3,016,046 — both for 2013.
The City Council also took up other business. Here are some meeting highlights.
Cities must certify their final 2013 levy and General Fund budget to Wright County by Dec. 28. In September, Delano set its preliminary levy and general fund budget for 2013, and the county used these figures in tax notices sent to property owners in November. The final levy and budget can be equal to or higher than the preliminary levy and budget but not higher. In Delano’s case, the final levy is $150,814 lower than the preliminary levy.
“The budget is a guide only,” said Delano Finance Director Brian Bloch. The City Council must approve all expenditures.
He explained the budget figures and how they compare with previous years. General Fund expenditures amounted to $2,594,117 in 2011 and $2,918,425 in 2012. The 2013 final budget of $3,016,046 is up by $97,621 from 2012, a little over three percent.
Bloch said most of the General Fund budget increase for 2013 is due to Delano setting aside $80,000 in a fund for future street improvements. This strategy will be used for the first time in 2013 and is expected to take place annually. Down the road in three to six years the city will use the accumulated money to pay some street expenditures. As a result, the city can sell a smaller amount of bonds for street projects and have lower principal and interest costs.
Delano’s expenditures increased in 2012 over those for 2011 because the city put off a lot of capital expenditures between 2008 and 2011, Bloch said. For those four years, the city was attempting to keep the property tax levy as low as possible. Then in 2012 Delano decided not to put off capital expenditures.
In 2013 the largest portion of the General Fund budget will fund the Community Services Department, which includes the Senior Center, public library, Planning and Park Recreation Departments and building inspections, Bloch said. General government expenses and public safety expenses each will account for 20 percent of expenditures — followed by public works at 15 percent and capital outlay at 15 percent.
Property taxes will provide the largest amount of revenue to fund the General Fund budget — almost 75 percent, he said. This is a noticeable change from 2000, when property taxes provided less than 30 percent of General Fund revenues. Intergovernmental aid, most of it classified as local government aid (LGA), funded almost 40 percent of Delano’s 2000 General Fund budget.
Between 2000 and 2013, intergovernmental aids have dropped significantly, Bloch said. As they declined, property taxes went up to make up for the loss of aids. Now Delano is getting no LGA. In the years since 2008, Delano has kept expenditures about the same.
“It’s kind of sad,” he said. “If we had kept getting intergovernmental aids, our property taxes would be quite a bit lower.”
Delano has three levies that together make up its total property tax levy — the General Fund levy, debt service levy and tax abatement levy. The 2013 General Fund levy is $2,202,780. The debt service levy is $347,000 that will help pay principal and interest for four different bond sales that Delano conducted in 2006, 2009 and 2011. The $100,000 tax abatement levy is for Delano Crossing, which is projected to pay taxes in excess of the $100,000 levy in 2013, Bloch said.
The total property tax levy of $2,649,780 for 2013 will be 2.9 percent higher than the 2012 levy, he said. He attributed the increase to the state funding problem, lower property values and the economy.
The tax impact for 2013 for a $225,000 homesteaded property is expected to be $2,599 — a 2.65 percent increase over the $2,532 for 2012. But property values have decreased by 2.5 percent, Bloch said. The tax figure represents the combined levies of the city of Delano, the Delano Public School District and Wright County, and it does not included the voter approved school levy referendum from this fall.
The City Council also:
SET the date for a neighborhood meeting on 2013 street improvements. Owners of all properties impacted by the improvements will be notified of the meeting, scheduled for 4:30 to 6:30 p.m., Wednesday, Dec. 19. Attendees will learn about results of a feasibility study that includes estimated costs. Delano expects to let bids for street projects in March or April.
“It’s important for us to hear from you,” said City Councilor Betsy Stolfa, “because you will have to live with it.”
SCHEDULED a public hearing for Tuesday, Jan. 8 concerning a feasibility report for the Northwest Business Park public improvements. The report will include estimated costs, benefiting properties and proposed assessments.
SET dates for the next two City Council meetings. They will be at 7 p.m., Wednesday, Dec. 19 and Tuesday, Jan. 8.