State's discovery reduces city levy

Brainerd's 2009 tax levy has been reduced by $37,692.

The Brainerd City Council on Tuesday learned the city was notified by Crow Wing County that the Department of Revenue found the preliminary and final tax levy of $4 million included $37,692 that was above the state-mandated levy limit of $3,962,308.

Finance Director Theresa Goble, who was absent from Tuesday's meeting, sent a memo to the council explaining that she originally believed the $37,692 could be added to debt service, which falls outside of levy limits, in order for adopted levy to remain the same as the preliminary levy of $4 million. After conversations with the Department of Revenue she learned that wasn't the case.

Mary Koep, ouncil member and Personnel and Finance Committee member, said the issue was confusing because the city was initially informed that $62,000 was outside of levy limits, only to be told a less amount had to be within the levy limits after the city had submitted its budget.

The bottom line was in order to conform with their directions we have to recommend a levy reduction, Koep said.

The council, on a 6-1 vote, approved taking it from a budgeted payment on a improvement bond with the understanding it could be switched to the general fund by the council at a later date.

Voting against was council member Bob Olson, who said because he voted against the original $4 million levy he would also vote against the reduction.

The Personnel and Finance Committee set a meeting at 5:30 p.m. on Feb. 5 to discuss state mandates and budget reductions.

Olson also sent out a memo Tuesday noting in 2008 there was a $600,000 deficit in working funds. With more cuts to local government aid in the forecast, Olson said the city will have to be thrifty.

We're going to have to put our noses to the grind stone and we're going to have to cut. We don't have the money, Olson said. I think the (City Administrator Dan Vogt) will agree, with these cuts we're in some tough times. I'd like to not lay off staff, that's the last thing I want to do, but we don't know where it's going to go.