In September the Redwood Falls city council set the preliminary tax levy for 2018.
While the council had the chance to change that number, which included a 4.99 percent increase over the 2017 levy, the only move that could be made was to make the increase less.
When the final levy was certified at the Dec. 19 council meeting, that is exactly what happened, as the final property tax levy was reduced by more than one percentage point to 3.49 percent.
According to Melissa Meyer, city director of finance and administrative services, who presented the property tax levy proposal to the city council, the primary reason for the reduction was a major reduction in the health insurance rates for employees.
The final levy for the city is $2,591,020, which is an increase of $87,281 over the levy for 2017. Meyer added when one looks at the total anticipated revenue for 2018 at just over $67 million, the property tax levy revenue makes up about 3.8 percent of that amount.
The other revenue, including state and federal tax dollars, fees for services and grants, comes in at $65,024,888.
Within the tax levy, the city will see a reduction in the general fund levy from $744,941 in 2017 to $730,184 in 2017, with an increase in the library fund from $348,889 in 2017 to $362,515 in 2018. Meyer said the increase in the library fund is primarily in salary and benefits.
In the special levies line item, the total amount being levied for 2018 is $1,450.982, which is an increase over 2017 at $1,364,366.
The city saw a slight increase in its bond payment for the community center, as well as an increase of approximately $3,000 in PERA.
The levy for the Garnette Gardens abatement actually decreased, with the Titan abatement being eliminated.
The largest special levy increase was in the police line item, and Meyer said a significant portion of that increase of just under $80,000 was for the purchase of a new squad car in the coming year.
The 2018 levy also includes a $55,000 abatement bond for the hospital pavilion, which the hospital pays back to the city, as well as approximately $2,000 more for the port authority.
The good news, added Meyer, is in addition to a smaller increase in the levy than was anticipated in September the city has also seen an increase in its tax capacity. While an increase in tax capacity is a sign of growth, it also becomes a positive for property owners, as the levy is spread over a larger pool of ownership.
The tax capacity for 2018 is just under $3 million, approximately $100,000 more than the tax capacity which was used in 2017.
Meyer said the city is anticipating an increase in local government aid from the state for 2018. In 2017, the city received $1,463,033, which is what had been certified at the state.
For 2018 that number goes up to $1,531,545. Meyer said the city can likely count on that number being what it actually receives, as since 2012 the LGA that had been certified by the state is the amount the city ultimately received.
In other action during its Dec. 19 meeting, the city council:
• Adopted a resolution approving the 2018 payments in lieu of taxes in the amount of $1,009,446, which comes from the electric utility, the water utility, the liquor store and the hospital.
• Approved a request to revoke Fifth Street as a Minnesota State Aid street and to establish Fourth Street as a Municipal State Aid street.
According to Jim Doering, city public works project coordinator, with the addition of amenities on Fourth Street, traffic counts are increasing, which is leading to more wear on that roadway. The change will allow for state aid funds to help make the improvements needed on Fourth Street in the coming years.
• Approved a request to revoke a portion of Gould Street between Second Street and Bridge Street, which doesn’t exist, as Minnesota State Aid street and to establish a portion of Swain Street between Second Street and Bridge Street as a Minnesota State Aid Street.
Doering said this change will allow the city to make improvements to Swain Street using municipal state aid when the state does its work on Bridge Street in 2018.
• Approved a request to develop a pay schedule for part-time employees at the municipal liquor store with an increase to $10 per hour to start with a 50 cent increase after the first six months and a 50 cent increase for each year of added experience. The intent of the change is to help with a growing issue of employee turnover.