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Council OKs 4.5 percent property tax increase

December 5, 2012
By Josh Moniz - Staff Writer , The Journal

NEW ULM - The New Ulm City Council set the local property tax levy at a 4.15 percent increase Tuesday following the public hearing on the 2013 budget.

The 2013 budget is $20,488,087, which is 5.1 percent, or $1,099,915, less than the preliminary budget. The budget will reduce its total expenditures by $681,826 to $9,238,671 while simultaneously seeing its projected revenues drop $197,826 to $9,088,671 compared to 2012. The property tax levy initially required $1,085,496, or a maximum 19 percent increase, but subsequent cuts approved by the Council brought the final rate down to 4.15 percent.

Compared to 2012, the total combined General Fund was reduced by $777,410. Department cuts were $384,279 from administration, $92,952 from police, $168,898 from fire, $33,932 from street, $23,524 from engineering, $3,683 from community access TV and $92,025 from airport.

Department increases were $6,988 for sewer and $14,895 for cemetery. In other areas, the Library Fund was reduced $2,843, the Capital Improvement Fund reduced $422,286 and Park and Recreation Fund increased $5,530, although areas like Community Center were reduced $67,520. The Park and Recreation Department also put off the Harman Park shelter improvements to prevent adding $200,000 to the property tax levy in the general fund.

Some examples of the property tax increase were given at the public hearing. The Average Market Value for a home in the current year was $121,800, which would have had city property taxes of $690.28. The Average Market Value for 2013 is $120,400 and the average city property taxes is $716.50.

Street repairs

The Street Department saw the biggest changes for 2013. It will undergo an approximately $34,000 reduction in funding. Street Department Commissioner Tom Patterson said his department will be able to remain on track with the current policy of keeping just behind even with street repair needs. However, he said the situation will continue to be similar to previous budgets where the department will not be able to get ahead of needed repairs until the City is able to dramatically increasing funding.

The other big item moved $375,000 in street repair costs from the general levy to Street Department annual bonding. The City previously put the portion on the levy to keep good financial policy of not bonding for projects not intended for the full 10 years terms of bonds, to keep it from costing more long-term as City debt and to keep the special assessment at approximately $2,800 per lot. The proposal will be over four years and may cause increases for special assessments.

Cuts for organizations

The other big change will be the ending of City subsidies to local organizations. Subsidies for organizations such as the New Ulm Retail Economic Development, the New Ulm Battery, the Concord Singers and the Municipal Band were spared any cuts.

The most affected organization will be the Bavarian Blast festival, which will be cut $2,500 in 2013. The amount represents half of the organization's annually received subsidy. The event's organizers said they had serious concerns about having their funding cut.

Other subsidies facing reductions include $3,444 for Healthy Community/Healthy Youth, $3,000 for the Lind House Association, $1,500 for the Wanda Gag House and $1,000 to the Fair Grounds Association.

The Council approved the reductions as part of a larger move to end its involvement in subsidies. The Council's final selection on which cuts to make were based the organizations' ability to generate new funding on their own.

Because there was no public comment at the hearing and no new suggestions for the budget, it advances to the next City Council meeting for final approval.

(Josh Moniz can be e-mailed at



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