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3.6 percent Crosslake levy hike likely CROSSLAKE CITY COUNCIL Senior Reporter CROSSLAKE - After a few cuts and a financial windfall are used, Crosslake expects its 2008 tax levy to increase by 3.6 percent.
That will be the number expected before the council at its Monday meeting.
The city's proposed 2008 tax levy is $2,614,255. Taxes from construction are expected to bring in $65,000 to offset the levy leaving $87,881 to be spread out on the existing tax base for a 3.6 percent increase compared to 2007.
In earlier budget discussions, the council considered a 2008 tax levy of $2,642,155. Wednesday during a special council meeting, city administrator Tom Swenson outlined suggestions to reduce the levy by $22,500 in expenditures and increase $5,500 in revenues.
And a financial windfall of $10,076 from Crow Wing Power - created when the utility sold its ownership interest in Hunt Technologies - is helping to pay for nearly $7,000 for a phone system serving the administration, planning and zoning and the police department.
Cuts came from a variety of spots such as reducing the fireworks funding from $12,000 to $10,000. Another reduction came in cutting the part-time police officer fund from $20,000 to $15,000, which is still a $5,000 increase for the fund compared to 2007.
No money was set aside for the $15,000 donation requested from the Crosslake Community School. After the city inquired about the donation request, the state auditor's office reported such donations were not allowed by law.
Council member Steve Roe said the staff put together a reasonable budget. But Roe wondered if it raised a philosophical question about how far tax levy increases should go beyond what increases in property valuations and construction dollars were bringing in.
Council member Dean Swanson said they tried zero increases in the past but it was devastating as things were not taken care of that should have been. Council member Rusty Taubert said that model means pushing expenditures off that will have to be made up in following budgets.
The council considered the repercussions of the 35W bridge collapse and what that could mean for expenditures the city has for its own bridges.
If the construction dollars are larger than the $65,000 expected, the burden on property taxes will be reduced.
The tax levy the city council adopted for 2007 was $2,461,374. New tax dollars from construction are expected to be reduced. In 2007, construction dollars brought in about $90,000 in taxes.
Taxes are the end product of a complicated process. In essence, it begins with an assessment of what a buyer would pay for a particular piece of property. Assessors estimate what property would be worth if it were sold in the open market.
How a property is used, whether for a residence or business, comes into play as a parcel's tax capacity is determined. Then the budgets of taxing authorities - cities, counties, townships, school districts and others - are part of determining tax burdens.
RENEE RICHARDSON may be reached at renee.richardson@brainerddispatch.com or 855-5852.
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