Bemidji City Council: Truth-in-taxation hearing Monday

BEMIDJI – The Bemidji City Council will hold its truth-in-taxation hearing Monday night during its regular meeting.
Residents are invited to the public hearing to express opinions on the city’s budget and property taxes. The meeting comes two weeks before the council is scheduled to adopt its final budget and property tax levy for 2013.
According to the meeting notice included in the city council packet, the proposed city budget includes a 10.9 percent decrease in spending from the 2012 budget. It also includes a 7.8 percent city property tax levy increase, which is mostly due to capturing newly-annexed properties.
The 2013 budget maintains city services and staff at 2012 levels for the most part, except the addition of one police officer and a squad car, a 2 percent operating budget increase, a capital budget increase of $45,000 and increased costs to provide services to annexed areas.
The budget also includes a 1 percent increase in gas and electric franchise fees, which applies to non-taxable properties as well as taxable ones. That is projected to generate $220,000 in additional revenue.
The general fund, which pays for essential services like police, fire and public works is budgeted to increase by 3.8 percent to $9,946,485 in 2013. About a third of the general fund is made up of taxes, while another third is made up of state aid. The proposed total city budget is nearly $31 million.
Street Renewal project
The council will consider the feasibility report on the 2013 street renewal project Monday.
Through a combination of street tax levy funds, utility funds and assessments, the city is aiming to improve 1.2 miles of roads. Half of the streets are gravel and the other half is pavement in need of improvement.
The total cost of the project is about $1.2 million, with 22 percent of the cost being paid by affected property owners through assessments.
If the feasibility report is passed, the council will hold a public hearing Jan. 7.
Construction is scheduled to begin in May and finish in September 2013.
Hotel loan hearing
A public hearing on the city’s loan for the proposed hotel on the south shore could be delayed.
The $400,000 loan was previously approved by the council during a work session Oct. 22. Money from the city’s loan fund, which is administered by the Headwaters Regional Development Commission and has been used for development projects, would be for the connection between the Sanford Center and the proposed Country Inn and Suites.
Due to the size of the loan and the fact that its interest rate was below commercial market rates, it constitutes a business subsidy per city policy and state statute, according to a memo prepared by city attorney Al Felix. That classification triggered the public hearing.
But the tentative Dec. 15 closing date “may not be achievable” due to “delays associated with the financing approval process,” the memo adds.
The staff recommendation proposes continuing or postponing the public hearing.