Property owners in the City of Redwood Falls now will know the basic framework for the local property taxes they will be paying for 2018 based on action taken by the city council at its Sept. 5 meeting.
That night the council approved the preliminary tax levy and budget for the coming year. The proposed levy was presented by Melissa Meyer, city director of finance and administrative services, who stated the process of developing the annual budget and coming up with the levy amount for the coming year started earlier this summer.
“Keith (Muetzel, city administrator) and I started meeting with department heads in July,” said Meyer, adding the staff then worked with the budgeting committee to come up with the preliminary number for 2018.
The proposed 2017 and payable 2018 levy would increase by 4.99 percent over what is being paid in 2017, said Meyer, adding that includes a 4.92 percent increase in the operating levy and a .07 percent increase in the abatement category.
That proposed levy in dollars would be $2,628,602, added Meyer.
Within that levy proposal, are increases in several areas, including a 3 percent salary increase for city employees, providing a $130,000 total increase as part of the levy. One of the unknowns, said Meyer, is health insurance.
The health insurance number used to establish the levy for 2018 includes a 15 percent increase over 2017, but Meyer added the city’s broker is hopeful that a lower rate can be negotiated.
The current amount would see an increase of $86,000 as part of the levy. The city provides 80 percent of the cost of health insurance, with the rest covered by the employee.
“We set the health insurance increase at the highest amount now,” said Meyer, adding it can be lowered before the final levy is certified.
What can’t happen, she said, is an increase in the final certified levy after the preliminary numbers have been set.
The good news, said Meyer, is the city’s tax capacity has increased by 5.8 percent over 2017, which equates to $164,452. No, she explained, that does not mean more dollars in the levy. Rather it indicates there is a broader base of property owners who will be paying taxes to cover the levy costs in 2018.
The general levy includes $749,051 in the general fund, $367,398 in the library fund and $47,339 in the port authority fund for a total general levy of $1,163,788.
Under special levy allocations are $59,710 from the general obligation funds for the community center debt, $31,343 in tax abatement for Garnette Gardens, $31,547 in tax abatement for the Redwood Valley Fourth Addition, $55,000 in tax abatement for the Redwood Area Hospital pavilion, $87,470 for the city’s PERA contribution rate increase and $1,199,744 in police wages and benefits. The total special levies amount is $1,464,814.
A tax abatement for Titan Machinery came to an end.
In addition to approving the preliminary levy, the city also approved the annual preliminary budget for 2018, which Myer said can be adjusted before final certification before the end of 2017.
Currently, the budget includes anticipated revenues of $49,744,597 and anticipated expenditures of $51,892,972.
The preliminary budget and levy are scheduled to be discussed again at the Dec. 19 meeting of the city council at 6 p.m. That night the city council is scheduled to certify the final levy and budget amounts for 2018.