MANKATO — A 2014 budget that will slightly reduce taxes for most Mankato property owners received the unanimous approval of the city council and unanimous disapproval by a handful of Greenwood Drive residents attending a budget hearing Monday night.
The $95 million municipal budget will be supported by $14,536,325 in property taxes, an increase of 1.3 percent over the real estate taxes collected this year. But because of an expanding tax base and the expiration of a northside tax-increment financing district, most property owners will see their city taxes fall by about 4 percent next year.
“I believe everybody on the council is happy about that,” said Councilor Jack Considine, who specifically asked if Councilor Mark Frost concurred.
Frost, the council’s most vocal opponent of increases in city taxes, did so reluctantly.
“I’m glad to see taxes are being reduced — mildly,” Frost said.
Existing city taxpayers appeared to agree because no one outside of Greenwood Drive spoke at the annual budget hearing where residents are invited to argue for or against the operating budget, the accompanying levy and the five-year capital project plan before the council makes its final decision. The Greenwood folks, however, were annexed into the city this year and received their first Mankato tax statement last month.
“I was very happy to hear about all the people whose taxes are going down,” said Marcia Olauson of 200 Greenwood Drive, more than a bit of sarcasm in her voice. “I wasn’t one of them.”
Compared to the Lime Township taxes paid this year, Olauson said she will be paying nearly 25 percent more in 2014 to the city of Mankato.
Dan Robinson of 170 Greenwood said the big jump in taxes came on top of more than $30,000 in assessments for hooking up to city water and sewer, which was required because the neighborhood near the Mankato Golf Club had become surrounded by the city and its septic systems are noncompliant within city limits.
“I don’t get it,” Robinson said. “This is nearly $1,000 a year in additional taxes and my life hasn’t been improved ... It may make sense to you folks, but it doesn’t make sense to my neighbors.”
Council members offered sympathy, and City Manager Pat Hentges said the neighborhood was now paying for city police and fire services, which should bring a major reduction in home insurance costs.
“Does it equate to a thousand dollars? No,” Hentges said. “But it is substantial.”
For existing property owners, real estate taxes will fall slightly next year. There will be some offsetting increases in other municipal charges, including a 2 percent bump in water and sewer fees and $1 per month increase in garbage/recycling costs to $14.65. In both cases, the increases are aimed at equalizing revenues in those funds with expenses.
The expense of garbage pick-up and disposal, for instance, was more than $1.7 million in 2013 and revenues were just over $1.4 million.
The 1.3 percent levy increase is devoted to paying off debt for previously approved city projects. Other increases in city spending, including employee pay increases of 2.5 percent, are possible because of increases in non-levy revenue such as state aid which is rising more than $500,000 in 2014.