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11-30-1992 Truth in Taxation MinutesSTATE OF MINNESOTA The Truth in Taxation Hearing COUNTY OF WRIGHT for the City of Otsego was CITY OF OTSEGO conducted by the City Council this 30TH day of November, 1992 at 7 . 30PM Norman F Freske, Mayor, Doug Lindenfelser, Floyd Roden, Larry Fournier and Ron Black, Council Members, Jerome Perrault, Clerk, Elaine Beatty, Deputy Clerk/Zoning Adm., Judy Hudson, Secretary, and Andrew Merges, Assessor, were present. The Hearing was called to order by Mayor Norman F Freske. Norman F Freske explained to the residents in attendance that the assessed market value for the City of Otsego in 1992 was $112,129,600.00 and is $118,761,800„00 for 1993. The tax capacity rate for 1992 was $1,413,242.00 and for 1993 is $1,488,483.00. The levy increase from $424,510.00 in 1992 to $545,000.00 in 1993 resulted in 6-1/2% overall increase in taxes for 1993. The levy increase and tax increase should have been gradual over the least three years, but the City was under a levy limitation in 1991 and 1992. Assessor Andrew Merges explained that the first $68,000.00 of a person's valuation is homestead and taxed at a 1% rate, from $66,000.00 to $150,000.00 at 1-1/2% and above $150,000.00 at 2%. The State sets the property values that he as the Assessor must use and he must be from within 90% to 105% of the State set valuations. He said the price people are willing to pay for property determines the going market value Norman F Freske commented that the bottom line an the tax proposals for 1993 shows a 1O% increase, Niel Gorder said his valuation keeps rising and is now higher than he could sell it for. Another resident said in the past six years his taxes have increased from $400.00 to $800,00. Ron Black explained that the City has had to budget an additional $50,000.00 for police protection, $20,000.00 more for another Street Maintenance Person, and $20,000.00 to $25,000.00 for recycling. Bruce Danks said his taxes went up a total of 304, that he was concerned how the money was being spent and how much is being wasted on lawyer fees. Ron Black explained that houses do not pay enough taxes to cover City expenses created by the houses. We are having problems with the DNR in getting commercial development along Highway #101. Bruce Danks asked if the Council had tried negotiating with the DNR? Ron Black said that we have tried, but they will not negotiate and just stonewall us. Larry Fournier said the City has set up an EDA to help attract business to increase our tax base and lower taxes„ Most businesses require 90% impervious lot coverage (buildings and parking lots) to be successful and the DNR is only willing to grant 50% along Highway #101. Vern Heidner asked how much tax base the Council anticipated from businesses. The Council replied that they STATE OF MINNESOTA, COUNTY OF WRIGHT, CITY OF OTSEGO, TRUTH IN TAXATION HEARING FOR THE CITY OF OTSEGO AT 7:3OPM -PAGE 2 - had not attempted to project this as yet. Ron Black said one of the main reasons we become a City was to have our own control of Planning and Zoning. We are now getting the revenue from building permit fees where before the County kept most of it. One resident asked about the difference in Rural and Urban Taxing Districts. The Council replied that they were doing a study of this at present, but was not completed as yet. Items such as police protection time and street maintenance time were being studied. Another item to consider would be street lighting in Urban and not Rural areas. One resident asked how much her tax would increase on a $100,000„00 house? Andrew Merges replied that it would be around $70.00. Niel Goarder said that at the Hearing before we became a City, Attorney Bill Radzwill said taxes would go down if we became a City. The Council explained that expenses would have risen whether we became a City or not because of the demand for more police protection, for recycling and increased street maintenance service. Ron Black replied that we are mandated by the State and County to provide recycling, but they provide very little financial assistance. Julie Randall asked about the 85TH Street project. The Council replied that 85TH ST from Page Avenue to Co #42 will be constructed as an MSA project using funds received from the State MSA Fund which will be about $312,000.00 for 1993, Floyd Roden said that we were able to purchase a new $80,000.00 truck this past year using MSA Maintenance Funds and at no cost to the residents of Otsego. Ron Black commented that we need input and participation from Otsego residents on such items as recycling, garbage collection and police protection. We also need volunteers to serve on the Planning Commission; the Park and Recs. Commission and on the EDA Advisory Board. We are now taking applications from people willing to serve on the EDA Advisory Board. Motion by Doug Lindenfelser to adjourn the Truth in Taxation Hearing. Seconded by Ron Black, all Council Members voted in favor of the motion. NORMAN F FRESKE, MAYOR FLOYD RODENT COUNCI RONALD G JP/eb .ACK, COUNCIL DOUG LINDENFELSER, COUNCIL LARRY FOURNIER, COUNCIL ATTEST: JEROME PERRAULT,CLERK