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|Paynesville Press - December 10, 2003|
City proposes budget for 2004
The city of Paynesville's proposed tax levy for 2004 is just $6,000 higher than its 2003 levy, in spite of an increase in the 2004 proposed budget and less aid from the state. |
The levy for 2004 - which was presented at a truth-in-taxation hearing last week and should be approved by the city council by the end of the month - is $443,300, up from $437,300 last year.
The proposed budget is $1,360,600, up from $1,307,300 in 2003.
A large portion of the city's revenue (over 40 percent) comes in the form of Local Government Aid (LGA) from the state, while the remainder comes from property taxes, fees for services, and other sources. But because of the state's budget deficit, state aid payments to the city were cut by nearly $94,000 in 2003, forcing the city to make spending cuts, reducing their proposed budget from $1,374,200 to their revised budget of $1,307,300.
In 2004, the city was originally told to expect $560,900 in state aid, but now expects $474,500, around $86,400 less.
Fortunately, said city administrator Steve Helget at last week's hearing, because the city was able to pay down a bond in October, saving $58,000, the city only had to make up for $28,400 in lost aid.
Transferring $27,000 from the liquor store fund to the general fund (instead of into the sidewalk fund) helped make up for the rest of the loss in state aid. Minor cuts to other areas of the budget, along with the levy increase, offset the state aid loss with minimal impact to residents, said Helget.
Few large changes were made to the city budget for 2004, which totals $1,360,605.
The amount budgeted for the Paynesville Municipal Airport was increased by 68 percent, from $16,800 in 2003 to $53,700 in 2004, to accommodate higher operating costs and costs for the purchase of fuel for the new airport. Helget expects revenues from leases and from fuel sales will help offset the expenses. In fact, the city has budgeted an increase in airport revenue of nearly $35,000 for 2004.
Because of the large street improvement project planned for 2004, the street and alley budget was increased by 18.2 percent, from $114,490 in 2003 to $140,000 in 2004.
Wages and benefits accounted for a $19,300 budget increase. And the hiring of a cable television coordinator last year accounted for an increase in the cable television fund, from $5,800 in 2003 to $11,600 in 2004. The municipal park fund was increased by over $10,000 to pay for new equipment for the park department.
Other budget increases included a $6,700 transfer to Paynesville Township to pay property taxes for land annexed to the city; and a $3,200 increase in the election fund to cover the cost of two anticipated special elections, one for Sunday liquor and one for an aquatic park referendum. Additionally, the city also budgeted money for a general election in November 2004.
Aside from the property tax levy and state aid, other revenue - including fees, fines, and interest income - accounts for nearly a third of the city's revenue. Other revenue sources have increased from $368,853 in 2003 to $442,751 in 2004, an increase of nearly $74,000.
The new airport accounted for the largest increase in expected revenue. The old airport earned just over $9,000 in 2003, while revenue generated by the new airport - hangar leases, farmland rental, sale of fuel - is expected to be $44,800 in 2004.
Fee increases by the state could boost the city's earnings from deputy registrar fees by over $14,100 from last year, and cable television franchise fees could account for an increase in revenue of $2,800.
City residents also will pay a slightly higher rate for water in 2004. According to public works director Ron Mergan, the bulk rate for water will go up about 11¢ per 1,000 gallons of water used. For the average homeowner, this means an increase of about 55¢ per month, or $6.60 per year.
The city's projected water revenue for 2004 is $356,800, and the projected sewer revenue is $516, 600. The city council is expected to approve the budget and levy at its last regular meeting in December, in order to certify their levy with the county before 2004 starts. (The next council meeting will be held a day earlier then usual - on Tuesday, Dec. 23 - because their usual meeting time - the fourth Wednesday of the month - is Christmas Eve.)
Residents may see increases in their property tax bills due to valuation increases, according to Helget, though the city levy change is very small.
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