City Holds Budget Hearing
The Rugby City Council held a public hearing on the proposed 2016 budget and 21 percent tax increase Tuesday in the Otter Tail Power Company meeting room.
Ward 3 Councilman and Finance Committee Chairman Jim Hoffert said the overriding principal of the proposed 2016 budget was “triage” – paying for the city’s expenses and contractual obligations while not wanting to raise taxes for residents on Social Security or fixed incomes.
For the 2016 budget, the city is levying $698,466, or 111.16 mills, on taxable property. Of the total levied, $619,357, or 98.57 mills, will go to the city’s general fund; $15,897, or 2.53 mills, will go toward snow removal; $25,385, or about 4 mills, will go toward the Heart of America Public Library; $12,693, or about 2 mills, will go toward the Rugby Job Development Authority and $25,134, or 4 mills, will go to the city’s Airport Authority. Rugby’s Park Board is levying 13.71 mills.
With the estimated total levy being 124.87 mills, the taxes on a $100,000 home would be $561.92. With state funds taking a 12 percent ($67.43) chunk, taxes would be reduced to $494.49.
Rugby resident Crystal Anderson asked what is the maximum amount the city can levy. The city can levy a maximum of 105 mills for the general fund, and four for other funds.
Last year, the city requested over 88 mills, and in 2013 the council had decreased its request from 108 mills to 83 after deciding to use reserve funds.
Rugby resident Doug Hauck questioned the council as to whether the decreases in mill levies the past two years could be considered a “tax break,” as he said there were comments in the Tribune and on the radio that residents received a tax break last year.
“I didn’t get a tax break, mine went up,” he said. “Out of four out of five years my taxes went up. So for you guys to make that comment, that’s not true.”
Rugby Mayor Arland Geiszler said that tax statements include county and the school board levies. City Auditor Elizabeth Heisey said this year’s budget would be used not to build up reserves, but to cover expenses.
The city is projecting to incur over $4.6 million in expenditures, including over $1.25 million coming out of the city’s general fund; $868,378 from the water supply and treatment fund (for operations, maintenance, etc.); $549,759 for infrastructure maintenance; $448,305 for special assessments on the District 2009-1 Citywide Street Improvement project; $316,270 for highway and streets; $297,325 for landfill and garbage; $138,922 for the District 2013-1 Special Street Improvement District; $123,951; and $99,398 for the District 2013-2 Special Water & Sewer Improvement District.
General fund expenses include: $435,333 to the Rugby Police Department, $120,670 toward operations and infrastructure repairs at the Rugby Swimming Pool, and $79,350 toward operating and maintaining the Rugby Armory.
The city is projecting to receive over $3.8 million in revenue, including $602,000 from water supply and treatment; $535,500 from infrastructure; $516,035 from the general fund; $302,520 from landfill and garbage; $245,000 from the City Job Authority Sales Tax (35 percent of sales tax collected in the city goes to the JDA, 65 percent goes toward infrastructure); $221,381 from District 2009-1 specials; $216,308 from highway and streets; $146,075 from sanitary sewer operations; and $93,465 from District 2013-1 specials.
In general fund revenues, the city is projecting to receive, including and in addition to the general fund levy, $367,000 from State Aid; $32,000 in fees generated by the swimming pool; $26,500 in Armory rental fees ($13,000 from the National Guard, $11,000 from the Rugby Public School District, $2,500 from the public); $22,500 from franchise fees from Midcontinent and North Dakota Telephone Company for cable television; $10,500 from beer and liquor licenses and $10,000 from fines and forfeitures.
The new fire hall and funding for it came under question. Per a 1957 agreement, the city provides the fire hall to store equipment and owns 1.5 trucks, the Rural Fire Protection District (a 540 square mile district containing the surrounding area and parts of Benson and McHenry counties) provides equipment. The city is paying $45,000 a year for the next 10 years on a general obligation bond for the new fire hall’s construction.
Anderson asked the council if grants are covering some of the city’s expenses. Geiszler said the city is on a list to get state funding, at a 60/40 split, for water projects. However, he said that on the list, communities who experienced population growth of 3 percent or more were of higher priority. He also said the city had been in talks with the N.D. Department of Transportation regarding funding for an eastbound frontage road in Chalmers Addition. Initially, the DOT would fund a 90/10 split with the city, however later the DOT gave the city news that frontage road funding had been cut.
“My encouragement is for everyone in this room to talk to their legislators,” Geiszler said.
A vote to pass the 2016 budget will be held Monday, Oct. 5, during the council’s regular meeting.
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