City’s FY 2023 tax levy, budget called into question

     The proposed Fiscal Year 2023 city property tax levy, accompanying public hearing, and public hearing on the city’s proposed FY 2023 budget all caused quite a stir at the Feb. 21 Monticello City Council meeting.

     A new state law requires the city to hold a public hearing after publishing the proposed property tax levy.

     The proposed tax collections for the city’s General Fund Levy ($8.10 per $1,000 of taxable valuation) and Employee Benefits Fund Levy ($3.47321 per $1,000 of taxable valuation) total $1,176,075. This figure is 11.51 percent more than the previous fiscal year’s total of $1,506,785.

     During the public hearing on the proposed tax levy, Mayor Dave Goedken questioned why he and the council were given revised FY 2023 budgets just ahead of the meeting when they had no time to review them.

     “I’ve had lots of visits with Sally (Hinrichsen, city clerk) and Russ (Farnum, city administrator) on the current proposed spending,” noted Goedken. “We’re proposed to spend more than we’re taking in; we going in the hole.

     “The last two years, we spent our surplus down to nothing,” continued Goedken. “As mayor, I can veto and request a review on this.”

     Goedken said both he and Hinrichsen are required to sign off on the budget. He said he will not put his signature on something he does not agree with.

     “I’m going to reach out to the auditor to find out if I’m required to sign it or not, whether I like it or not,” added Goedken. “We’re headed toward bankruptcy; we have to cut spending.”

     Monticello resident Tom Osborne mentioned that prior to the council meeting, he made three separate requests of city staff for a copy of the proposed FY 2023 budget and tax levies. He received nothing, which he said he found concerning. Osborne also questioned the $11.51 proposed tax rate when his records reflect a little over $13.

     “Our goal was to keep the rate approximately the same,” clarified Farnum. “There was a small increase in the levy from $1.5 million to $1.68 million this year.”

     “As citizens, we’re not privy to this information,” said Osborne.

     Hinrichsen also explained to Osborne that the 11.51 percent only reflects what the state requires the city to publish ahead of the hearing. She pointed out on the published document that it does state (in small print) that the levy does not reflect the city’s general fund, debt service, and capital improvement reserve. All of those added together brings to levy to the $13 Osborne questioned.

     “Then we’re getting inaccurate information,” continued Osborne. “We have no information to make a decision to give reasonable opinions on the levy.”

     “We’re complying with what the state asks us to do,” added Farnum.

     He further offered that city staff was asked to look at cutting up to $300,000 ($384,000) from the city’s proposed FY 2023 expenses, and it took up until the afternoon of Feb. 21 to make those changes. He told Osborne there was not a concrete version of the budget to put before the public.

     Goedken offered that during the council’s last work session, he was led to believe the budget was fine as presented.

     “And now we have another budget,” he said.

     Goedken asked if the city needed to start its budget process earlier in November to meet certain deadlines.

     “That will not help,” Farnum said. “The numbers won’t make sense because we won’t have the taxable values until Jan. 1. It wouldn’t do any good.”

     Some of those General Fund cuts Farnum alluded to earlier include set-aside funds for capital projects and major expenditures such as the Aquatic Center. Farnum admitted he advised Parks and Rec Director Jacob Oswald to budget for $30,000 in the pool set-aside fund. In an effort to make some cuts, that took it down to $10,000.

     “But we can’t ignore those expenses and then all of a sudden have to spend $60,000 on the pool,” said Farnum.

     Goedken ended the discussion by saying, as mayor, he would not approve of the FY 2023 budget if it was not a balanced budget.

     However, Hinrichsen warned the council that if they did not approve the property tax levy during the council meeting, they would have to move forward with the levy from the previous year due to strict publication guidelines set by the state.

     “This is my first go-around,” commented Goedken, “and I’m a little apprehensive with what I’m signing.”

     The council unanimously approved the proposed FY 2023 tax levy.

     The council also set a public hearing for Monday, March 21, at 6 p.m. regarding the city’s proposed FY 2023 budget.