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Bemidji City Council: 19.9 percent levy increase

An already-stretched Bemidji budget isn't expected to improve much next year, according to city officials.

The Bemidji City Council on Monday adopted a 19.9 percent levy increase for 2010. The council voted 6-0 in favor of the increase; Councilor Barb Meuers was absent.

The decision, made during the regular council meeting, followed a 40-minute work session dedicated to the budget.

"Our budget is as tight as it's going to get," city Finance Director Ron Eischens said during the work session.

The levy increase will recapture revenues lost through Local Government Aid cuts in 2008 and 2009.

Eischens and City Manager John Chattin both warned that if further cuts are made to LGA, the council will have to make difficult choices.

Eischens said the council would either have to replace lost LGA dollars through tax increases (if levy limits even allow for that kind of increase) or cut services.

During the work session, councilors asked questions on the budget and suggested some possible cuts for the future.

But for 2010, Councilor Greg Negard asked if there was any way to delay some capital improvement purchases to save money.

"I know at some time you have to replace equipment," he said. "But some of these things can we put off until things get a little better?"

Staff noted that capital improvements already were delayed in 2009 due to LGA cuts.

Chattin said you can maybe delay a purchase one or two years.

"You really can't get away with it any longer than that because your equipment is disintegrating," he said.

Negard also noted that the city still has included in the 2010 budget the $183,500 that previously was allocated toward the operation of the Bemidji Regional Airport.

Prior to 2009, both the city and Beltrami County contributed $183,500 to airport operations from their general funds.

In 2009, the airport created the Bemidji Regional Airport Authority, which also has taxing authority. The Airport Authority this year adopted a $367,000 levy for 2010.

But while the county has adopted a 1.91 percent decrease from 2009 - attributed in part to the taxing authority for the airport - the city has not removed those funds from its budget.

Rather, $183,500 has been designated to operations and maintenance for the Bemidji Regional Event Center.

Negard said taxpayers will not only then have a 19.9 percent levy increase for the city, but also an additional 5 percent for the airport.

It is then a 24.9 percent increase, he said.

"I understand that money's been taken away from us," Negard said, referencing lost LGA dollars. "I'm just saying that's a tough one to swallow."

City Engineer/Public Works Director Craig Gray pointed out that the 2010 budget does not include any increases for fuel, salt or wages.

He noted several services that Bemidji provides that similarly sized cities do not.

If a resident calls and asks the Public Works Department to come and pick up filled leaf bags in falls, Gray said workers go out and pick them up.

Workers could even go to the same neighborhood or street several times in one week, he noted.

"That's a service people like to use," he said.

Gray noted that it will be services like that he would suggest cutting in the future, if further budget reductions are required.

When city councilors were asked if they had received feedback from city taxpayers on the levy and budget, none said he received comments.

Eischens reminded the councilors of the phone calls that deluged them when there was consideration of library cuts.

"You will be getting calls on service reductions," he said.

Councilor Ron Johnson said he believed the lack of input from residents was due to increased awareness of the impact of LGA cuts on local city budgets.

"People are starting to hear about it," he said. "They're getting it."

Councilor Roger Hellquist suggested that newly hired Fire Chief David Hoefer be asked to look into the necessity of having the Bemidji Fire Department respond to medical calls. Hoefer is expected to join the city's workforce in January.

Chattin said that come February or March, when he expects LGA cuts to become more specified, staff will present a list of possible cuts for the council's consideration.

"I'm think (LGA cuts) are going to be significant," he said.