MANKATO — The Mankato City Council resisted attempts by some members to lower its preliminary levy for 2014, opting to begin the budget discussion with a maximum tax hike of 2.3 percent.
Under state law, the council had to set a ceiling on the possible increase in property taxes for next year, and the preliminary figure will be the one used to calculate potential taxes on individual homes and businesses that will be sent out to property owners in coming weeks. The council can still reduce the amount before it finalizes the 2014 budget later this year.
“We could go from 2.26 (percent) down to zero if that’s the council’s wish,” said Councilman Mark Frost, who made clear that was his wish.
Councilman Jack Considine argued for the higher preliminary levy and persuaded fellow council members to add $5,000 to the economic development levy to allow a potential doubling of the city’s donation to the Southern Minnesota Initiative Fund.
Frost, after watching the city create a new street-lighting fee this year and fail to cut its levy despite shifting costs of operating the public library to Blue Earth County, argued for starting the 2014 budget discussion with a low preliminary levy. In his decade on the council, Frost said he’s learned that the preliminary levy hike typically becomes the final increase as well.
The 2.26 percent levy increase was recommended by City Manager Pat Hentges, all of it in the debt service portion of the city’s property tax collections. The bulk of the increase would be used for debt payments for improvements to the Public Safety Center, land acquisition at the Public Works facility and upgrades at All Seasons Arena. But Hentges also would like to see the debt service revenue boosted to provide a cushion for street and utility project bond payments where some of the special assessments have been deferred until benefiting parcels are annexed into the city.
Councilwoman Karen Foreman made a motion to pass a levy hike of about 1.3 percent — enough to cover the increased bond payments for the public facilities. But that middle ground failed to garner any support.
Foreman then joined Considine, Councilman Jason Mattick and Mayor Eric Anderson in approving the 2.3 percent initial hike. Frost and Council President Chris Frederick were opposed, and Councilwoman Tamra Rovney was absent.
“We can still reduce that, and I expect we will,” Considine said.
The budget will be finalized in December following several more council workshops and meetings.