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Baxter sets 2022 preliminary tax levy at 6.9% increase

Next steps include a planned 6 p.m. Dec. 6 information meeting to review the 2022 budget and property tax levy and hear from the public with the council expected to adopt the final 2022 budget, levy and capital improvement plan at the Dec. 7 meeting.

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Baxter Finance Director Jeremy Vacinek, left, speaks to the Baxter City Council Sept. 21, 2021, during a workshop with council members Connie Lyscio, Zach Tabatt, Mayor Darrel Olson, Mark Cross, with City Administrator Brad Chapulis and Kelly Steele, assistant city administrator. Contributed screenshot

In a subdued city council budget session, punctuated by a crackling sound system and long moments of silence, Baxter City Council members took another look at the city’s 2022 budget numbers.

“I doubt that anybody is happy with where we’re at,” Mayor Darrel Olson said at the Sept. 21 city council budget session.

Council member Zach Tabatt said he wanted to see forward looking projections as much as possible, with ways to strategize and do financial planning in the future in order to look ahead before the annual budget process.

Olson agreed.

Olson said they did have meaningful budget conversations with a lot of items and issues that came up as well and while the levy is still higher than they would like to see it, the discussions were profitable.

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RELATED: Baxter City Council tries to strike balance in budget Baxter City Council met in a workshop setting to look at options to reduce the levy, with options including reducing services, cutting back on road projects and eliminating an audio/visual improvement for city hall and virtual participation.
“It’s safe to say none of us like the number that we’re at but let’s hang our hats on the hope that we can reduce it,” said council member Connie Lyscio.

Once the final levy is adopted, it can be decreased but not increased.

After the work session, the council met in regular session and voted unanimously in favor of the budget items in the consent calendar without comment.

Council member John Ward was absent for health reasons.

Next steps include a planned 6 p.m. Dec. 6 information meeting to review the 2022 budget and property tax levy and hear from the public with the council expected to adopt the final 2022 budget, levy and capital improvement plan at the Dec. 7 meeting.

2021 levy \u0009

  • $7,256,500 levy,

  • $12,785,914 taxable tax capacity,

  • 56.755% tax capacity rate.

2022 preliminary levy

  • $7,755,100 levy,

  • $13,354,735 taxable tax capacity,

  • 58.070% tax capacity rate,

  • 6.9% increase or $498,600 more than the 2021 levy.

Reductions

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After city council direction to reduce the city’s budget further, thus reducing the needed levy, staff made another $222,000 in cuts.

Those cuts included:

  • $60,000 from a reduction in street overlays,

  • $50,000 by eliminating the closed-captioned audio visual equipment for city hall,

  • $75,000 cut from Oscar Kristofferson Park playground equipment,

  • $37,000 in cuts yet to be determined.

Estimated property tax impact

The city’s portion of property taxes was based on the average valuation change of 3.75% for residential and 2.82% for commercial/industrial.

With that formula, a home valued at $76,000 in 2021 would have an estimated value of $78,850 for 2022. That home would have paid $259 in city taxes in 2021 and would pay $283 in 2022 for a $24 increase or a 9.3% change.

A $175,000 home in 2021, is expected to have an estimated value of $181,563 in 2022 and would pay an additional $62 in taxes going from $871 to $933 for a 7.1% increase.

A $250,000 home in 2021, would see an estimated increase in value in 2022 to $259,375 and pay $90 more in taxes to the city going from $1,335 to $1,425 or a 6.8% increase.

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A $500,000 commercial/industrial property in 2021 would be expected to increase in value to $514,100 in 2022 and pay $285 more in taxes going from $5,250 in 2021 to $5,535 in 2022 for an increase of 5.4%.

Renee Richardson, managing editor, may be reached at 218-855-5852 or renee.richardson@brainerddispatch.com. Follow on Twitter at www.twitter.com/DispatchBizBuzz.
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