• 27°

Council approves 2020 tax levy, proposed budget; Levy will see an increase of just over 4 percent

The Austin City Council approved the 2020 tax levy during its regular meeting on Monday night.

The 2020 tax levy was set at $7,150,000, an increase of $277,000, or 4.03 percent, from 2019. This amounts to a total city property tax increase of about $16 for the year on a residence valued at $100,000, according to City Administrator Craig Clark.

The increase stands in stark contrast to the 2019 increase of 15.69 percent. Much of the 2019 increase was attributed to budgeting for the implementation of the results of the Compensation and Classification study the city ordered as a means to see how it compared to other cities in employee pay so as to stay competitive. City officials recently received an initial draft of the study, according to Clark.

The increase for 2020 comes from the city planning for the further implementation of the Compensation and Classification study, modifications in some departmental budgets and settling bargaining unit contracts that had not been settled by Dec. 31, 2019.

Given the higher tax levy increases over the past few years, Mayor Tom Stiehm was adamant to keep the 2020 tax levy increase as low as possible during budget discussions earlier this year.

Clark said that when adjusting for inflation, the city is actually doing more with less. In 1997, a home valued at $100,000 in Austin paid $303 in city property taxes. When adjusted for inflation, that is the equivalent of $453 in 2016 dollars. In 2016, a home valued at $100,000 in Austin paid $323 in city property taxes.

“This shows what we have discussed many times that we’re doing more with less and inflation takes a toll on our costs too, but we’ve worked to keep taxes in check,” Clark said.

Under Minnesota law, the levy must be submitted to the state by Sept. 30. Administrative Services Director Tom Dankert told the council it may lower the levy after that date, but may not increase it.

The council also passed a proposed 2020 budget of $35,913,342. The proposed budget consists of the following expenses:

  • General Fund – $18,711,807
  • Recreation Programs Fund – $98,996
  • Library Fund – $1,207,731
  • Fire PERA – $60,000
  • Tax Increment Debt Service Fund – $308,643
  • Capital Improvements Revolving Fund – $2,656,000
  • Sewer User Fund – $5,633,162
  • Waste Transfer Station Fund – $1,4000
  • Port Authority Fund – $885,765
  • Storm Sewer Maintenance – $1,114,337
  • Central Garage Fund – $2,233,140
  • MIS Replacement Fund – $247,086
  • Fire Fleet Replacement Fund – $193,000
  • Risk Management Fund – $2,512,275

Dankert told the council it may adjust the budget as needed; however, any increases made cannot be funded by the tax levy.

The date for the Truth in Taxation hearing, a public hearing in which the budget will be discussed in detail, was set for 6 p.m. on Wednesday, Dec. 4.