MORRIS - The Morris City Council approved a three percent increase to the city's tax levy and an approximately $8.9 million city budget for 2013 at their regular meeting on Tuesday.
The total 2013 tax levy is about $1.29 million dollars; about $636,000 of the levy will go into the city's General Fund, $50,000 will go to the Library Fund, and $602,000 will go to pay down the city's debt.
City Manager Blaine Hill gave the council a presentation on the budget and levy during the city's Truth in Taxation hearing Tuesday. Hill began his presentation talking generally about taxes and the city's reliance on Local Government Aid (LGA).
"You will hear in the news that taxes are getting too high... I want you to keep that in mind when we go through this budget and talk about the levy because that's not true," said Hill.
The city's $1.29 million levy is about $37,000 higher than the property tax levy of $1.25 million in 2001. The levy dropped almost $500,000 in 2002 to about $843,000 after the state provided an increase in Local Government Aid.
Over the last decade, Morris' tax levy has slowly inched back up, hitting $1.25 million again in 2011 and 2012.
Hill also briefly explained that taxes are levied on the value of property in the city. From 2012 to 2013, the market value of property in the city of Morris decreased .2 percent. In contrast, the city's tax capacity - the capacity of the property value to generate taxes based on tax rates for different types of property - increased .4 percent from 2012 to 2013.
"I don't want to go any further than that because I'll just confuse you," Hill told the council.
This year, LGA was again frozen at 2010 levels - about $2.11 million. LGA accounts for about 54 percent of the city's general fund budget and about 71 percent of the library budget.
One issue each year is the cost of health insurance for city employees. After receiving insurance rates from several carriers, Hill elected to switch to Medica - a 12.3 percent increase over rates in 2012 compared to an 18 percent increase over the city's 2012 provider.
Employee contracts freeze the city's share of single-coverage cost and allow for an eight percent increase in family coverage, which means families will pay an additional 4.3 percent for coverage in 2013.
An ongoing discussion that arose during the budget discussion was how the city will fund needed infrastructure improvements and which infrastructure improvements should be a priority in 2013.
In 2012, the city developed a new process to "reclaim" roads with adequate underground infrastructure but a poor road surface. Hill explained that reclaiming the road could add 10 to 15 years to the road's life before it would need to be entirely re-done.
"The reclaim costs slightly more than overlays, but we get a lot better product," explained City Inspecting Engineer Jay Fier.
Council member Bill Storck asked why improvements to the bike paths along Greenriver Road and along Highway 28 on the west side were included in the road improvement list.
"I don't get a nickel's worth of use out of [the bike paths] because I don't do any walking," Storck said. "It's just like the people that play tennis - we pay for all the lights. We don't buy my minnows to go fishing."
Hill and Fier defended the bike path improvements, noting that if they aren't maintained, they'll be difficult to replace later.
The council also voted to increase utility rates three percent for 2013.
The council passed a resolution authorizing the issuance of up to $10 million in Health Care Facility Revenue Notes for St. Francis Health Services. Although these types of bonds need to be issued through a municipality like the city, the city of Morris will have no liability for the bonds.
The council authorized a $50 a year increase to the annual benefit for the Morris Fire Department, raising the benefit from $1,730 to $1,800 per year. Firefighters in the department receive a retirement benefit based on this amount and the number of years they have served.
The council amended an encroachment permit for Prairie Surgicenter (the old Willies Super Valu building).
In 2002, Prairie Surgicenter was issued an encroachment permit after surveyors determined that a corner of the building encroaches on the city's right-of-way by .2 feet. Prairie Surgicenter is in the process of selling the building, and so a new survey was completed that revealed that the building now encroaches on the right-of-way .45 feet. The permit was amended to reflect this change.
The council voted to assess the Best Northland Prairie Inn $500 for a fire service call on July 5, 2012 that the owners have not yet paid.
The council approved 2013 liquor licenses for the American Legion, Ranch House, Wohlsol Inc., and Crystal Lanes and Entertainment Center.
In his report, City Manager Blaine Hill notified the council that a new capitol improvement plan for the Morris Municipal Airport has been approved by the Minnesota Department of Transportation. The next project will be a new hangar for airplanes, followed by an equipment storage bay and a new snowplow or loader with a blower.