City budget comes together as vote draws nearer
The Red Wing City Council is narrowing down options in anticipation of a special Dec. 5 meeting where members hope to approve the 2012 budget.
In a discussion during Monday's meeting, council members and the mayor came to a general consensus on a plan that would lower the levy increase and draw more from the city's fund balance.
"I still feel the 3 percent was OK and reasonable, but I want us to get this done," Council member Lisa Bayley said, referring to the levy increase.
The council discussed a budget plan that would take $150,000 from the fund balance and use the most recent draft of the capital improvement plan, which draws on bonding funds and $1.5 million from the general taxes. That would lower the levy increase to roughly 2.4 percent, down from the 5 percent preliminarily approved and the 3 percent more recently discussed.
Public Works Director Rick Moskwa and Engineering Director Ron Rosenthal said the bonding in the CIP plan covers the projects staff think need to be addressed, though Council Administrator Kay Kuhlmann pointed out the bonding is much higher than in the past.
"It's the first time we've really put this capital budget together using bonding as a significant resource," she said at a recent capital budget workshop.
Still, council members said they would agree to that general plan, as did the mayor.
"I'm comfortable with that," Mayor Dennis Egan said. "I committed to being willing to put money on the table and look at the needs of the city."
But that plan sketched out by the council and mayor Monday night differs from the draft staff had drawn up.
That plan for the 2012 budget took about $67,000 from the fund balance and kept the levy increase at 3 percent.
"I don't think it's the best course of action to have an unbalanced budget ... using one-time resources for perpetual expenses," Finance Director Marshall Hallock said of dipping too far into the fund balance.
Hallock also pointed out that the city has other expenses outside the general fund.
Council members had originally said staff should look at using up to $300,000 from the city's fund balance. While they said Monday that amount was higher than they were now comfortable with, some council members saw the fund balance amount as an opportunity to lower the levy.
Egan said in talking with Council President Ralph Rauterkus and Bayley, who serves as vice president, he had expressed concerns about raising the levy 3 percent.
And while staff has cited a community survey showing residents are willing to take a modest tax hike to maintain services, some council members were skeptical that would still hold up.
"I have to say that survey was taken long before last week's mail," Council member Peggy Rehder said, referring to property tax statements that recently went out.
Changes at the state level, local fees and other government entities all affect local property owners, members said, and will mean an increase in what many will pay.
"Like it or not, what the county and school district are having to do impacts the same people that we're having to deal with," Rehder said.