HomeMy WebLinkAbout2004-12-06 Council Minutes
CITY OF CORCORAN
TRUTH IN TAXATION HEARING
DECEMBER 6, 2003
1
The Corcoran City Council met on December 6, 2003 at City Hall in
Corcoran, Minnesota, for the purpose of the Truth in Taxation Hearing.
Present were Councilors Bucher, Gageby, Guenthner, Lymangood, and
Thomas, and Administrator Vergin. Mayor Guenthner called the hearing to
order at 7:00 p.m., followed by the Pledge of Allegiance to the flag.
MOTION by Bucher, seconded by Lymangood, and carried unanimously to
approve the agenda as presented.
Mayor Guenthner advised that the purpose of the hearing was to discuss the
2005 budget and tax monies that are levied by the City in order to operate and
provide services to residents and property owners. The City is required by
State Statute to hold this hearing. The City Council held several workshops
during the budgeting process, which he noted were poorly attended by the
community. The City continuously monitors its budget through out the year.
Staff will present a summary of the budget and there will be opportunity for
public comment during the hearing process.
Administrator Vergin provided an overview of the proposed 200 5 Budget and
Levy. Reviewed the Fund Reserve Policy and projections for the years ending
2004 and 2005. The State Auditor recommends that cities have a reserve fund
balance between 35-50% of their current expenditures. The City of Corcoran
has established a policy recommending a 40% fund reserve balance. It is
projected that by 2006 Corcoran will achieve that balance. The rate of
expenditures for the proposed budget show an overall increase of 7.15%
including all debt obligations; cost related changes to the budget showed an
increase of 3.30%, while scope related changes showed a 2.23% increase.
When comparing Corcoran to neighboring communities of Medina, Dayton
and Greenfield we looked at both tax capacity and taxes per capita. Medina
has over double the amount of commercial/industrial than Corcoran, while the
City of Corcoran has three times the commercial/industrial tax base of
Greenfield. It is projected that in 2005 Corcoran’s per capita will be at $290,
while Greenfield will be the largest at $440 per capita. Medina and Dayton are
comparable at $390. We also looked a debt levels for surrounding
communities in 2004. The average for those responding showed a debt level
of $1,878 per capita; while Corcoran is at $210 per capita, very similar to the
City of Plymouth, while the City of Medina was the lowest at $130 per capita.
Based on the proposed 2005 levy the tax impact to residential properties was
reviewed. A $250,000 home in 2004 had a city tax liability of $722, for 2005
that same property would see a tax liability of $700, therefore seeing a
decrease from 2004 to 2005 by approximately $22. However the property
values in Corcoran went up approximately 15%, therefore that $250,000 home
would now have a value of $287,500, with a tax burden of $805, an increase
of $105 or approximately 11%. The final overview was that of a recently
approved Open Space Preservation Plat known as Summerhill, which consists
of 15 units. It is projected that the City will receive $162,317 in fees, including
building permits, land use fees and park dedication fees. Based on today’s
dollars the 15 units would provide the city with additional tax dollars
Call to Order
Roll Call
Pledge of Allegiance
Approval of Agenda
Purpose of Hearing
Proposed Budget & Levy
of $36,388, and increase the
population by 45. Overall the City
CITY OF CORCORAN
TRUTH IN TAXATION HEARING
DECEMBER 6, 2003
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was able to lower its tax rate for 2005, while still being able to achieve the
goals and objectives it has set for 2005.
Public Comments:
Ken Kluck, 21800 County Road 50, questioned the increases to the budget for
the Public Works, Police Department and Fire Department Contracts.
Mayor Guenthner responded that the Police Department went up 12.26% from
the modified 2004 budget due to the additional officer. The Public Works went
up 2.71%, primarily due to wage increases. Fire Contracts went up 12.78%.
Tom Cossette, 9200 Shannon Lane, questioned the capital budget and why it is
not part of the general operating budget.
A brief recess was taken so that Administrator Vergin could provide copies of
the CIP plan and budget for 2005.
Administrator Vergin provided an overview of the process by which the city
acquires capital equipment through the financing of equipment certificates.
The city budgets for two years, borrows funds that are repaid in 5 years. The
2004 and 2005 CIP purchases were identified while preparing the 2004
budget. Modifications to the budget are done if necessary, but t he funds have
already been borrowed. If the City does not utilize all funds they can be used
to reduce the debt.
Councilor Gageby surmised that the City of Corcoran has less taxes per capita,
less debt per capita, and a lower tax rate. These were achieved due to the good
fiscal management of the 8 years by the current Mayor and various terms of
the current council members.
Councilor Lymangood noted that Medina’s tax rate is lower than Corcoran’s
which they are able to achieve due to their high commercial tax base. Further
noting that Corcoran has been able to continue to meet the demands of the city
with less. There are mandates by the State, but no funding. The City has been
able to utilize volunteers to help with the work load. The City currently has
less employees than it did in 1992, and still meeting the needs.
Councilor Thomas added that the city has controls in place and good
processes.
Councilor Bucher clarified that in the per capita graph the total debt of the
communities had been included.
Mayor Guenthner stated that finance is not his background, he has relied on
the fiscal diligence of the members of the council. Expressed the need for
Public Comments
Council Comments
Corcoran to pursue commercial tax
base, referencing Medina’s ability
to maintain a lower tax rate with
less people. Thanked
CITY OF CORCORAN
TRUTH IN TAXATION HEARING
DECEMBER 6, 2003
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Administrator Vergin for her work that she has done.
Brian Lother, 10110 County Road 116, questioned the formulas used for
paying for services from the fire departments.
Mayor Guenthner responded that there was an inequity with the allocation of
payment to the Hamel Volunteer Fire Department, and therefore the city
worked with Medina and the Fire Department to reformulate and restructure
the contract to be more equitable and reflective of the actual usage of the
service.
Councilor Lymangood added that the formula is set up using both market
values and the number of calls. It is anticipated now that the Hamel Contract
is nearing completion that we would perhaps look at similar contracts with the
other three departments that the city contracts with.
Brian Lother. 10110 County Road 116, questioned the council on what they
attribute less personal today then in 1992, but much more being done.
Mayor Guenthner stated that it is a business and has to be treated as that which
benefits the constituents and expresses the values of the community.
Councilor Lymangood added that having volunteers assisting the paid staff has
been helpful. Suggested that the city track those hours.
Greg Ebert, 6503 County Road 101, the accountability has changed over the
years and concurs that it needs to be run as a business.
Brian Lother, 10110 County Road 116, expressed concern that two of the
newly elected officials were not present, disturbing as a private citizen.
Mayor Guenthner stated that there is a good process in place that will help
guide the new council, which should end with good results.
Hearing no more public comments or comments by the Council, May or
Guenther declared the Truth in Taxation Hearing concluded, and announced
that the City Council would consider the adoption of the proposed budget and
levy for 2005 at the December 21, 2004 council meeting.
MOTION by Thomas, seconded by Bucher, and carried unanimously to
adjourn, 8:08 p.m.
____________________________________
Susan Vergin, City Administrator
Additional Public Comments
Hearing Concluded
Adjournment