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City holds Truth in Taxation meeting; has proposed 9.9 percent levy increase

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Bemidji, 56619

Bemidji Minnesota P.O. Box 455 56619

The city of Bemidji has proposed a levy increase of 9.9 percent for 2008.

During a Truth in Taxation hearing at Bemidji City Hall Monday, Finance Director Ron Eischens explained the levy increase and answered questions from the City Council. One resident attended the hearing, but did not ask questions or address the council.

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The City Council will adopt the final budget during its Dec. 17 meeting. It may vote to lower the proposed levy from 9.9 percent, but cannot raise it.

Eischens reported that the city is proposing a 9.9 percent levy increase that will essentially replace the $260,000 lost in local government aid for 2008. (A 9.9 percent levy would generate $256,392 in extra funds for a total of $2.85 million.)

He stressed that the 9.9 percent levy increase only applies to the city portion of residents' tax bills, which also includes tax dollars for the school district and county. In 2008, 31 percent of a resident's tax dollar will go toward the city, 20 percent to the school district and 49 percent to the county.

For comparison, Eischens compared those numbers to 2001, when 19 percent went to the city, 38 percent to the school district and 43 percent to the county.

The city has lost $750,000 in LGA since 2002, Eischens said. The City Council has voted since then to not only raise the levy to cover those lost funds, but to also generate more dollars for improved operation and maintenance in the city, he explained.

Eischens also presented the following facts and information during his presentation:

-- The 2008 statewide average for proposed levies is 9.2 percent.

-- 45 percent of property in the city is nontaxable (32 percent is residential, 18 percent commercial, 4 percent rental and 1 percent is other).

-- 67 percent of the general fund in 2007 went to personnel costs (27 percent to operating expenses, 5 percent to equipment, and 1 percent to transfers and other).

The entire presentation is available online at www.ci.bemidji.mn.us

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