9/12/2019 3:10:00 PM 2020 levy coming together in North Branch
The North Branch City Council held a work session on its 2020 budget and levy, minus Kelly Neider and Joel McPherson.
(Council member Neider attempted participation by iphone from northern Minnesota, but equipment wasn’t fully functioning. Under Open Meeting laws a member is counted as being in attendance if the council can see and hear the attending members, and if the remote member can be seen and heard, which was not the case.)
North Branch’s new finance director Joe Starks presented the budget scenario as-is, and council agreed it will act to adopt a preliminary 2020 levy number later this month.
As discussed in work session, North Branch proposes an increase in levy of 2.84 percent.
This is a maximum set in the fall so property tax statements can be printed, and then in December the final is adopted. This preliminary levy can’t grow, but it can be trimmed between now and winter.
Starks explained the budget adheres to council’s stated “financial objectives” of paying down North Branch’s considerable debt, maintaining adequate reserves and being fiscally responsible.
Over the last 10 years staffing levels in various city departments have decreased, and Starks was pleased to report the 2.8 percent increase will cover adding a public works employee. “This brings the department back to 2008 levels,” he remarked.
The proposed levy also has built into it a $20,000 contribution to the future replacement fund for emergency communication radios and network subscribing expenses.
The first payment for the new fire truck isn’t due until 2021, Starks said. But, the fire department does have a couple years left paying-off its new SCBA units. Another approximately $5,200 annually is being added to cover expenses with a new four-tiered pay schedule for the firefighters. Pay will be based on participation and effort each firefighter puts in, such as their number of calls responded to, training hours, public events volunteered for, etc. Starks said the department opted to tie pay to actual hours put in instead of every member receiving the same basic monetary compensation. Firefighter pension levels (city contribution) are projected to stay the same in 2020, but Starks advised this is something the city should be analyzing for budget impacts.
For the Police their (state) PERA does increase in 2020 by .75 percent. The new officer hire from April will also be showing up as a full year expense in 2020. Costs for elections also had to be added to next year’s budget.
City Administrator Renae Fry pointed out for council that health insurance inflation levels are beginning to be contained. She commended the negotiations that have resulted in “avoiding double digit” expense hits related to health care. There are now caps in contracts on city contributions to family and single member plans for public works and city hall staff.
There are no city council wage hikes planned at this time.
The citizen committees of parks, planning and EDA were discussed for reinstating per diems. The city eliminated compensation for attending these meetings in budget-cutting measures a decade ago. Mayor Jim Swenson commented that maybe more people would show interest in serving if there was a $25 payment or so for citizens. Starks calculated for the three committees and membership the impact would be $4,500 if all attended every scheduled meeting.
Technological enhancements for council chambers were reviewed and staff explained a $47,000 quote that’s been submitted, but not acted on. Starks cautioned the three council members that every $47,000 equates to a one percent increase in levy, so they’d be looking at a 3.84 percent hike if they awarded this project.
The meeting concluded with Starks asking council for feedback over the next couple weeks and Mayor Swenson said hopefully five members will be present to vote on a preliminary levy later in September.
At an increase of 2.8 percent the city levy could be supported by a median-priced home of $215,000 paying an additional $5 per year on the city portion of taxes, said Starks. The tax right now on this sample North Branch parcel is $800. This property tax projection is based on property valuation remaining the same from 2019 to 2020.