Medina’s proposed budget reflects new building costs

The Medina City Council on Tuesday, Sept. 3, adopted a preliminary property tax levy for 2014 of $2,807,902 to fund a large portion of the city’s general fund operating expenses. With debt service included, the city’s total preliminary property tax levy is $3,428,080.

The council took action in time to meet a Sept. 15 deadline for certifying the preliminary 2014 levy and general fund budget to Hennepin County. Approval of the final general fund budget and property tax levy will take place in December. The final figures can be equal to our lower than the preliminary figures but not higher.

The preliminary 2014 levy reflects actions of the Minnesota State Legislature this spring. Cities are required to limit increases in their general fund property tax levies to 3 percent above their 2013 levies.

However, the Legislature is allowing some exceptions to property tax levy limits. Medina will use one of these exceptions to pay for increased operating and maintenance costs of city buildings. The city is almost done with renovation of the former Clam Corps office and warehouse building at 600 Clydesdale Trail for use by the Public Works and Police Departments, so Medina will have to take care of an additional building in 2014. Also, the city will have a full year of debt payments for the building upgrade. So the preliminary general fund levy shows a total increase of 5.5 percent.

Mayor Liz Weir summed up what is happening with the preliminary 2014 general fund budget.

“The City Council and staff have taken great care in preparing the 2014 preliminary budget and tax levy,” she said. “Staff have continued to hold down department costs, even while work loads increase with all the new developments in our north east area. The city has hired no additional staff since 2008, and we have stretched out the longevity of our aging road system.”

She continued, “The council remains vigilant on the behalf of our taxpayers and believes this is a fair budget and levy that still enables the city to maintain a high level of services to our citizens.”

After the meeting, Weir said Medina’s 2014 preliminary general fund budget is 5.5 percent higher than the 2013 general fund budget. Operating and maintenance costs for the new public works and police facility are responsible for 4.5 percent, and other operating costs are responsible for 1 percent.

Medina resident Bob Franklin spoke up from the audience about the preliminary general fund budget and tax levy. He said that six or so years ago he and his wife were concerned about property tax increases. Since then, the council has been transparent and responsible about the budget. He also said that the council made a responsible decision about renovating the property on Clydesdale Trail to fix a public facilities problem.

Franklin called the 2014 preliminary budget and tax levy “responsive and responsible.” He also said, “Keep doing what you’re doing.”

He asked the City Council to be aware of increasing development and pressure on public facilities in the future. He specifically mentioned roads.

After approving the preliminary tax levy, the council approved a preliminary 2014 general fund budget of $3,948,175. This figure is a 4.5 percent increase over the $3,776,425 actual general fund budget for 2013.

In a third budget-related action, the council approved a resolution reducing debt service tax levies by $117,376 from the originally proposed 2014 debt service levies. These levies will be used to help pay off bonds from 2010, 2011 and 2012. For the past several years, Medina has been using both bonding and special assessments to pay for road improvements and, as a result, has incurred some debt.

Medina officials calculated how the 2014 property tax levy would affect property taxes for a homesteaded residential property, assuming that no change in market value is involved. City property taxes for a $300,000 home would amount to $737. The owner of a $700,000 home would pay $1,908 in city property taxes. In both cases, city property taxes would go up 3.2 percent.

According to city officials, Medina’s 24.64 percent property tax rate compared favorably with eight neighboring cities — Orono, Wayzata, Minnetrista, Independence, Corcoran, Long Lake, Loretto and Maple Plain. Orono had the lowest property tax rate at 17.67 percent, Medina came in at second lowest, and Maple Plain had the highest rate at 79.65 percent. Medina’s proposed 2014 tax rate is 25.4 percent.

 

Contact Susan Van Cleaf at susan.vancleaf@ecm-inc.com

 

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