NEW ULM -Faced with uncertainty over the state's plans for Local Government Aid in the coming year, the New Ulm City Council set its property tax levy for next year high, and kept its spending low.
The council approved the preliminary 2011 budget and tax levy on Tuesday. The tax levy was set at $5,629,543, which includes levies for the Economic Development Authority, the Downtown Parking District and the Debt Service Levy. The 2011 General Levy was $3,861,437.
The gross property tax increase is 4.23 percent, or $228,487, according to figures presented by City Clerk-Treasurer Reg Vorwerk.
The city is expecting to receive $4.8 million from the state, an increase of $730,165 over last year. But with the state facing a $6 billion shortfall in its upcoming budget, the city is not counting on receiving the full amount.
The preliminary budget cuts general expenditures by $1.3 million, or 11.87 percent over last year's budget.
The city will hold budget workshops over the coming months, and will hold its final budget hearing on Dec. 14, at 6 p.m. The council could decrease the tax levy at that point, but would not be able to increase it.
Vorwerk went through the budget fund by fund, pointing out the increases and decreases in spending. City Manager Brian Gramentz said the budget is basically an extension of the 2010 budget, holding to last year's spending levels except where the increases are out of local control, such as the cost of insurance.
Councilor Les Schultz offered the resolution approving the budget and levy, and thanked the city staff for preparing a "bare bones budget."
In other business, the council approved a variance to allow Bruce Hippert, on behalf of Hipster LLC, to construct a building on his property at 1220 S. Valley St. right up to his property line. This would allow Hippert to build a railroad spur onto his property, allowing truck transports to load and unload within the building.
The approval was recommended by the Board of Zoning Adjustments.
Assistant City Attorney Susan Nierengarten pointed out to the council that the State Supreme Court had issued a ruling in June that sets stricter guidelines for cities to issue building variances. The city must prove that the variance is needed to prevent a hardship to the owner, and that there is no other reasonable use for the property without it.
The council felt the request met the requirements, but sent another request for a variance back to the board of zoning adjustment. The variance was requested for the Dakota West Addition, allowing houses to be built within 15 feet of the front line of a cul de sac, instead of 30 feet. The city has approved such variances in the past for cul de sacs. The councilors agreed that it should probably change the setback ordinance instead of requiring developers to request variances.
The council also authorized the purchase of a new police cruiser, a 2011 Crown Victoria for $21,968.
The council approved the purchase of a wetlands credit to allow it to take out a wetland on the planned airport runway extension project.
It also approved a license for Farmers Co-op of Hanska to close Second North Street between Front and Water streets for the purpose of grain storage between September 2010 and May 2011.