Serving Northern St. Louis County, Minnesota

Could rising Ely property taxes force exodus to Winton?

Keith Vandervort
Posted 12/5/19

ELY – A lone city resident addressed the Ely City Council last Tuesday during the annual Truth in Taxation hearing on the proposed 2020 budget, and predicted a mass exodus from Ely into nearby …

This item is available in full to subscribers.

Please log in to continue

Log in

Could rising Ely property taxes force exodus to Winton?

Posted

ELY – A lone city resident addressed the Ely City Council last Tuesday during the annual Truth in Taxation hearing on the proposed 2020 budget, and predicted a mass exodus from Ely into nearby Winton and Morse Township if property taxes here keep rising.
“My taxes are going up again this year by 5.4 percent,” said East James Street resident David Oliver. “I’ve lived in my house for three years and (taxes) have gone up several hundred dollars, or 30 percent in those three years. That’s 10-percent average each year. That is not sustainable.”
Oliver noted that his appearance at the tax hearing was not because he was “pi__ed at the city of Ely,” but because theirs was the only tax meeting that he could attend.
“I appreciate the fact that your AFSCME employees’ insurance is going up,” Oliver said. “I don’t get an increase in my Social Security to cover the fact that your non-fixed costs are increasing like mine are. A 10-percent per year tax increase is absolutely unsustainable. It is unconscionable, and it ought to be criminal.”
Oliver predicted that the council members would have a good laugh at the outraged citizen, because it is fun and there isn’t anything they can do about it. “This is the only forum I have, and I can’t believe that I am the only one in the city of Ely that is upset enough about taxes going up at this magnitude that they don’t show up for this,” he said.
“They are a lot smarter than me,” he continued, “They know nothing comes of it.”
Oliver made some predictions. “Winton is going to explode,” he said. “Winton is just going to grow like crazy. And these tax rates are going to drive people to the townships and Winton.”
The city’s total 2020 tax levy is proposed at $1.796 million, a 2.62 percent increase over 2019. The city’s net tax capacity increased by two percent, from $1.469 million last year to $1.496 million for 2020.
“This is our initial levy,” said Mayor Chuck Novak. “Following this hearing, the city budget committee will meet again to see what we can do. This initial levy is the highest the city can have, but we can go lower, and there is hope that we can do that.”
City Clerk-Treasurer Harold Langowski presented the proposed budget, which is also available for review on the city’s website.
The estimated taxable market value in the city of Ely for 2020 increased by $3.29 million, or 2.2 percent. “This is important because it tells us about new construction in town, and increased (property) value,” Langowski said.
Property taxes for the General Fund, including police and fire, street maintenance, building safety, administration, parks and recreation, legal services, building operations, and planning and zoning, increased by $18,700, or four percent, over last year.
Local Government Aid (LGA) is set to increase by $159,321 or 7.23 percent, from $2.205 million in 2019 to $2.364 million in 2020, Langowski said.
Total General Fund expenditures are budgeted to increase $193,400, or 5.7 percent, over last year. “This increase is mostly due to general inflationary costs and projected staffing changes,” he said.
Library expenditures are budgeted to increase 5.5 percent, or $16,300. “This is due to an extraordinary maintenance item (new HVAC venting) and staffing costs increases,” Langowski said.
The Cemetery Fund is increasing by more than 28 percent in 2020, from $23,500 to $30,100. That increase of $6,600 can be directly attributed to climate change, according to Langowski. “We have seen our maintenance costs go up over time,” he said. “Our (warmer) summers have required additional lawn mowing. We now mow all the way into September, and that obviously costs additional funds.”
The Airport Fund, meanwhile, has been reduced to zero, from an annual levy of $13,000. “We no longer need to levy property taxes for maintenance out there,” Langowski said.
The Debt Service Fund will increase by $84,900, from $230,200 in 2019 to $315,100, to largely pay for the Ely Utility Commission project to replace utility meters in the city.
Capital Projects Fund expenditures decrease about 13.5 percent, from $597,200 in 2019 to $516,700 in 2020. “This fund fluctuates from year to year,” Langowski said, due to the size of the projects that we do and the amount of grant funding that we receive. This doesn’t necessarily mean that we have less projects or smaller projects, but more to do with using some of our fund balances to complete those projects.”
Equipment replacement is increasing 8.67 percent, from $150,000 to $163,000. “The library is planning to install a security system,” he noted. “As you all know, equipment doesn’t get any cheaper. We have funded this at $150,000 each year, but it is looking like next year we will run out rather quickly. We continue to be diligent with our equipment. For example, we have dump trucks that are more than 20 years old. I don’t think you will find a lot of communities that can keep their equipment running that long.”
The budget committee is expected to meet one more time to discuss the 2020 budget on Monday, Dec. 16. Based on the committee’s recommendation, the city council expects to set the final levy on Tuesday, Dec. 17.

property taxes

Comments

No comments on this story | Please log in to comment by clicking here
Please log in or register to add your comment