Bemidji City Council begins budget discussion for 2023
The council heard a report on what to consider for next year’s budget during its May 23 meeting, including ongoing maintenance and staffing questions and the rising cost of inflation.
BEMIDJI — During its work session on Monday, the Bemidji City Council officially began discussions for the 2023 city budget.
The May 23 meeting started with a report presented by City Finance Director Ron Eischens, who outlined some of the key financial considerations the council should take into account.
“Our goal with this work session was to give the council a good idea of what staff and department heads think are critical issues for 2023,” Eischens said.
One of these critical issues was the addition of new staff in various departments, ranging from hiring an assistant city clerk and another engineering technician to a long-term goal of adding seven full-time firefighters to meet national staffing safety guidelines.
Another topic of consideration was the costs of capital improvements and maintenance to city buildings and property.
“We have a lot of really quickly aging pieces of infrastructure,” said Ward 4 Councilor Emelie Rivera. “I don’t know if waiting until things break down is necessarily the best.”
Eischens provided estimates for 2023 budgets for maintenance and improvements to city parks and streets, as well as the Sanford Center.
All of these budget considerations affect the city’s levy rate, which was also included in the presentation.
Reductions elsewhere in the proposed budget brought down the levy increase, despite the costs of new staff and maintenance.
Because the Sanford Center is under new management, one proposed reduction included decreasing the deficit funding for the event center from $450,000 to $308,000 or lower.
This decrease, along with other revenue sources, placed the potential gross levy increase for 2023 to 4.7%. The increase last year, for comparison, was 9.5%.
Discussions also arose on how to budget for unanticipated needs, like the flood damage to City Hall which has displaced a large portion of city staff.
The budget for 2023 will likely need to include a temporary location for those employees to be housed, as well as funding for whatever plans emerge for City Hall itself.
“There’s always new information,” Eischens said. “The budget itself is not set in stone. It’s fluid and flexible, or at least it should be.”
Rivera wanted to see the city take a more proactive approach both to building and infrastructure maintenance and the ongoing need for staffing.
“It’s really going to come back and bite us, I’m afraid,” Rivera said. “One big piece is the infrastructure, but the other is staffing.”
Another difficult thing to anticipate while budgeting for 2023 is the impact of inflation, which the city has felt in everything from fuel costs to construction projects.
“Everything is really getting hit hard by the pricing right now, and just the supply issues,” said City Engineer Craig Gray. “This whole year is really going to be interesting, and really going to be trying.”
Inflation isn’t just affecting the city, which Mayor Jorge Prince wanted to acknowledge.
“Inflation is hitting us as a city,” Prince said, “it’s no doubt impacting every citizen as well, whether in fuel or housing.”
Prince explained that his concern about inflation was one of his considerations when looking at the levy increase, which he was glad wasn’t as high as last year’s.
“To consider a levy like we had last year, I couldn’t support that,” Prince said. “I think what you’re sitting at, 4.7%, is a much more reasonable place to be.”
None of these numbers were finalized during the meeting, and simply provided a foundation for discussions moving forward on how the city’s budget should be organized. The next step in the budgeting process will be a discussion on council priorities in June.
“I certainly anticipate several more meetings to talk about budget issues and council priorities in the future,” Eischens said.