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City Council Discusses Preliminary 2016 Budget

By Staff | Sep 11, 2015

Due to the Labor Day holiday, the Rugby City Council held its regular meeting on Tuesday evening and discussed the preliminary budget for fiscal year 2016.

Ward 3 Councilman and Finance Committee member Jim Hoffert said the major principal underlying the budget was that taxes are expected to increase.

For the budget, the city levied $671,794.17, or 105.71 mills on all taxable property, $546,549 or 86 mills will go into the city’s general fund and 7.21 mills ($45,805) is expected to go toward bond payments for the city’s new fire hall.

The Finance Committee received requests from several departments, including $310,000 for building and maintenance, $87,375 for swimming pool needs and maintenance, $107,060 for recreation needs and maintenance, about $1.86 million for water plant maintenance, $1.94 million for streets (including $50,000 for another street sweeper, $70,000 for a city shop addition and $1.8 million for chip and seal projects), and $2.5 million for sewer infrastructure (including $70,000 for the Lift Station and $2.4 million for replacing infrastructure). The Heart of America Library put in a request for $38,800 from the city.

City employees are expected to receive a 2 percent raise in salaries, along with an anniversary raise of 35 cents.

A public hearing on the proposed budget has been scheduled for Tuesday, Sept. 29, in the Otter Tail Power Company Meeting Room.

City, County Spar Over LEC

Board of County Commissioners chairman and District 4 Commissioner Duane Johnston informed the council that six weeks ago the county representatives of the Joint Law Enforcement Center Board asked the city to consider rental payments as well as increase its contribution for dispatcher costs from $26,500 to $40,000. He asked the council if it could be added to the preliminary budget.

Hoffert said the committee heard the request when they were working on the preliminary budget, but didn’t have enough information to support it.

Johnston said the city hasn’t been paying rent for the facility since 2009, and District 5 Commissioner David Migler added that the facility is county property – which the Pierce County Sheriff’s Office, the Rugby Police Department, N.D. Highway Patrol and the N.D. Bureau of Criminal Investigation.

Ward 1 Councilman Neil Lotvedt said the city pays over $107,000 per year to the LEC and asked if that money supports it. He also asked if the LEC. is losing money. County Auditor-Treasurer Karin Fursather said yes, and that due to S.B. 2144 the facility would no longer receive tax levies it was receiving in the past, with the exception of capital construction and improvement projects. Money for incurred costs would be coming out of the county’s general fund.

Mayor Arland Geiszler asked Migler if the Rugby Police Department has to vacate the LEC if the city doesn’t pay rental fees. Rugby resident and BCI agent Craig Zachmeier said whether the city should pay more to the LEC has been argued for years. He reminded the council that the agencies together in the facility help to keep the city of Rugby safe, and that if the police department were forced to vacate there would be more problems than a rental fee. Rugby resident Randy Fossum agreed, saying the agencies together in the same place were worth a lot more than rent.

The council voted to include L.E.C. rental fees into the proposed budget – an increase of 2.5 mills – with councilmen Hoffert and Lotvedt voting no.

The council voted to approve the preliminary budget as amended, with Ward 2 Councilman Gary Kraft voting no.

Franchise Fee

The council discussed a resolution to enact franchise fees on Otter Tail Power Company. Geiszler said the franchise fee would be similar to a sales tax fee and would only apply to Otter Tail users rather than property owners. Out of monies paid, Otter Tail would then pay the city a sum equal to 3 percent of monthly revenues received.

Rugby resident Jim Day questioned whether there was a need for a franchise fee, as Otter Tail includes a $1 facilities charge on bills sent to users. Geiszler said the franchise fee was different.

Enterprise Funds

The council voted, with Ward 3 Councilman Joel Berg voting no, on increases for water treatment and supply, sewer, storm water (formerly flood control), landfill surcharges and infrastructure maintenance. Fees would increase to $16 per month for water treatment for the first 1,000 gallons, and $4 for each additional 1,000; $9 per month for sewer for the first 1,000 gallons of water, and $4 for additional 1,000 gallons; $3 per month for storm water; 50 cents per month for landfill surcharges and $4 per month for infrastructure.

Kraft asked how much in revenue the increases were expected to generate. City Auditor Elizabeth Heisey said the measure is a “band-aid” until a rate study can be done.

1st St. Drainage

Rugby resident Jackie Albright asked the council what actions were going to be taken regarding storm water drainage. During a rain storm, water heads to the east side of the street and has nowhere to go due to engineers in the past stopping regrading at a hill in the street.

Area resident and District 2 County Commissioner Mike Christenson asked if a slot could be cut into the street and and have a grating system put in place. Lotvedt said it would be great for an inlet, but questioned whether it would be good for an outlet.

Kraft said gutter work on that street may be necessary down the road.

Ward 4 Councilman Terry Wentz said that Public Works and the city should look into this, and that they could get estimates from Knife River Construction, who would be in town next week.

One option discussed was to shave off and regrade the crown in the center of the road. Others included leaving 8-10 feet on the sides of the road and taking out the center, and creating an inverted street.

The council approved a motion to have Public Works cut the street.

3rd Ave. SW Closure

The council listened to a proposal from Rugby School District Superintendent Mike McNeff, who asked if the district could close 3rd Ave SW in front of Ely Elementary School to through traffic from 9 a.m. to 3 p.m. during school days.

McNeff said the school would like to start using the lot across the street – which the district recently purchased – for recesses as early as this winter.

McNeff said that while the road does see some use, he didn’t think it was a “major artery.”

Lotvedt and Rugby Police Chief John Rose shared concerns as to what would be blocking the roads. Both Lotvedt and Rose said that traffic cones wouldn’t be a good solution, as they could be moved easily.

Wentz said he would like to council to revisit the closure after the district starts doing it in order to address traffic flow and public works concerns.

The council approved a motion to allow closure with a review after two months of use.

Other Business

Pierce County Tax Director Kelsey Siegler presented to the council an assessment of the property at 401 2nd St SE, owned by Jamie Lee. A fire damaged the house on June 1, and it has since been demolished. Remaining on the lot, which was valued at about $8,500, was a garage and furnace valued at $10,000. The council voted to pro-rate the abatement from the time of the fire.

The council approved extending the contract of B&J Excavating, which will last from Sept. 15 to Nov. 25. B&J is extending water and sewer lines out to the new site of Gooseneck Implement.

The council approved a motion to finance a second police car on a three-year note for 3 percent interest from Merchants Bank.

The council approved six-month raises for Heisey and for Public Works employee Mark Pfau.

The council approved a special events permit for Dollars for Scholars, as well as an in-city beer and wine license for the Rugby Eagles – for wine and beer service at the Prairie Village Museum on Sunday.

The council approved putting out a call for bids for rental of 10 parcels of city-owned land.

The council approved a driveway reconstruction variance for Levi Heisler.

The council approved the minutes and financial statements from the JDA.

The council approved the meeting minutes, bills, financial statements and Municipal Judge report for the month of August.

Meeting Video

The Tuesday meeting was also the first time Rugby City Council meetings were captured on video. For interested parties who wish to see city government functions, the video, in its entirety, can be found on the Pierce County Tribune’s Facebook page and on the Tribune’s YouTube channel: “Pierce County Tribune Your Source For News”.

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