BEMIDJI -- After several earlier meetings about 2021’s finances, the Bemidji City Council is expected to take official action on next year’s tax levy at tonight's meeting.
Based on discussions at the city’s Aug. 24 work session, City Finance Director Ron Eischens is recommending the approval of a $6.5 million preliminary tax levy, an increase of $397,200 from 2020. While the amount will rise by 6.5%, Eischens said in city documents that if a resident’s property value remains the same, their city taxes are unlikely to go up because of the values from new construction and recent annexation.
Documents show the majority of the 2021 levy would be dedicated to the city’s general fund of $5.5 million. The levy would also have $30,000 directed toward the Sanford Center’s capital replacement needs, $385,000 toward street improvements, $323,677 for South Shore land bonds and $267,055 for bonds related to the city’s Public Works Facility.
Should the preliminary tax levy be passed, the council would have the ability to reduce the levy, but not raise it, before it passes the final levy at its Dec. 21 meeting. By approving Eischens’ recommendation, the council would also schedule a truth in taxation hearing, which provides financial details to residents, on Dec. 7.
Another financial matter the council is scheduled to discuss tonight is the allocation of funding from the Coronavirus Aid, Relief and Economic Security, or CARES, Act. According to documents, the city received $1.6 million on Aug. 10 from the CARES package.
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The funds received can be used for expenditures related to COVID-19 needs from March 1 through Nov. 15. Much of the recommended allocations will be for staffing needs, scheduling changes, additional responsibilities and accommodation of COVID-19 protocols.
The recommendations are:
- Bemidji Police Department payroll expenses at $546,051.
- Bemidji Fire Department payroll expenses at $12,790.
- A total of $183,119 toward additional responsibilities for several positions, including city manager, finance director, public works director, legal staff, accountant, HR technician, city clerk, planning director, building staff and the parks and recreation director.
Additionally, $49,052 would be approved for COVID-19 and personal protective equipment for all city departments, including the Sanford Center. The recommendation for the council will be for related costs through July 31. The remaining balance would then be allocated in similar fashion.
Another council item for Monday evening is the establishment of a Redevelopment Project Area and a Tax Increment Financing District. The location of the district is bordered by Rako Street Southwest, Lakeview Drive, 18th Street and Washington Avenue.
The Redevelopment Project Area would be established to promote and secure development of property in the area. The intention of the TIF district would then be used to cover the costs of redevelopment planning.
The area has four parcels of land and the expectation is to use much of it for a mix of owner-occupied and rental housing, along with a small commercial development. Documents show the estimated tax increment revenue comes to $16.3 million, with expected interest of $1.6 million for a total of $18 million.
TIF districts are a financial tool available to Minnesota cities. When they're established, a TIF district will have additional property taxes generated by new real estate. Those taxes are then used to pay off the expenses of developments in the area.
The meeting will begin at 6 p.m. on Tuesday, Sept. 8 and can be viewed online on the city's website .
