The Brainerd City Council Monday set its preliminary 2003 levy and truth-in-taxation hearing dates.
The total preliminary levy for 2003 will be $1,937,625, and the truth-in-taxation hearing will be initially held at 7 p.m. Dec. 9 and continued to the city council meeting at 7:30 p.m. Dec. 16.
The preliminary levy limit has to be certified by the Crow Wing County Auditor no later than Sept. 16. A levy can be lowered after it has been certified, but it can't be raised.
The levy limit set by the state was $1,406,282, but there are $524,223 in levies which are outside state-mandated levy limits: the armory bonds, the airport improvement bonds, the Ahlm property contract for deed and eight other government improvement bonds.
The overall preliminary levy limit of $1,937,625 was an increase of about $317,000 from 2002.
In a memo to the Brainerd City Council, City Administrator Dan Vogt said city department heads are still working on the 2003 budget. The biggest requested increases on the expense side of the budget will be in personal services, including wages, health insurance premiums, additional personnel and capital purchase requests.
Vogt said because of the uncertainty of the state budget and the possibility of cuts in local government aid from the state, he will be recommend freezing all capital purchases and hirings until the end of the 2003 legislative session.
BAXTER: Impact on homeowners calculated
By RENEE RICHARDSON
BAXTER -- Baxter residents with a home valued at $120,000 will have a $12 increase in city taxes for 2003 if a proposed budget is adopted.
The Baxter City Council on Tuesday approved the preliminary budget and established a property tax levy of $2,622,564 for 2003. The levy may go down before the city's budget is adopted in December, but it cannot increase.
Baxter's preliminary budget for 2003 was approved at $3,899,322. The city needed to submit the proposed 2003 budget to the Crow Wing County auditor's office by Sept. 16.
What that means for taxpayers can be most easily seen in home values.
* A home valued at $80,000 paid $328 in 2002 city taxes. For 2003, the proposed city tax for the same home value is $337 -- or an $8 increase.
* A home valued at $120,000 paid $493 in 2002. That same home value faces a city tax of $505 in 2003 for a $12 increase. The increase amounts to 2.5 percent.
* A home valued at $160,000 paid $657 in city taxes in 2002. Under the 2003 proposal that same home pays $673 in city taxes for an increase of $16 compared to last year.
New construction, net from Tax Increment Financing districts added about $310,000 of new tax capacity for 2003. The $2,622,564 property tax levy is made up of a $2,134,564 general fund operating levy, $138,000 certificate of indebtedness levy and $350,000 debt service levy.
Jeremy Vacinek, assistant finance director, reported the council gains flexibility by moving $170,000 from the debt service levy fund to the general operating fund levy. While the $180,00 of the proposed overall $350,000 debt service levy will be earmarked immediately, the remaining $170,000 would be levied as part of the operating budget giving the council greater flexibility in regard to spending cuts if Local Government Aid from the state is reduced, Vacinek said.
Vacinek reported the state is projecting a $2.5 billion deficit for the next biennium. Local Government Aid and property tax credits are considered likely candidates for state cuts to help balance the budget.
If reductions occur with state legislative decisions when the Legislature adjourns in May, the council could respond with mid-year spending reductions or delay transferring the funds and then spread the debt service levy out along future years.
Vacinek said if aid reductions do not take place the council could transfer the $170,000 back to the debt service funds after the Legislature ends its session in May.
The Truth in Taxation meeting is set 6 p.m. Dec. 2 at city hall. The council is scheduled to adopt the 2003 budget at its Dec. 17 meeting.
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