12-03-1990 Council Minutes Budget Hearing

Home Browse Search

MINUTES OF THE ORONO 1991 BUDGET HEARING HELD DECEMBER 3, 1990 • ATTENDANCE 7:00 P.M. The Council met on the above date with the following members present: Acting Mayor Edward Callahan and Councilmembers Diann Goetten and Barbara Peterson. Mayor Grabek and Councilmember Nettles were absent. The following represented the City Staff: City Administrator Mark Bernhardson, Building & Zoning Administrator Jeanne Mabusth, Public Works Director John Gerhardson, Finance Director Tom Kuehn, Police Chief Mel Kilbo, and Dorothy Hallin, City Clerk. OPEN PUBLIC HEARING The Affidavit of Publication was duly noted and Acting Mayor Callahan opened the Public Hearing at 7:00 p.m. INTRODUCTORY INFORMATION Bernhardson began by welcoming those in attendance. He then gave a brief explanation of Truth in Taxation. He said, "Truth in Taxation was enacted approximately two years ago by the State of Minnesota. It established certain budget criteria for local government. Last year via �iere only required to place a notice in the paper. This year: each property owner received a summary statement regarding the taxes for his /her jurisdiction. There are two school districts primarily in this area, Orono and Westonka. The tax statemZnt for Orono shows that taxes are proposed to increase frog, $1,C38,246 to $1,853,541, or a 13.1% •increase. The state,-tient also shows the increases proposed for Hennepin County and the Orono School District. To some degree, these statements are misleading. Some people have added the percentages for the City, School District and County together. That is incorrect. The statement is also misleading because Orono taxpayers will not necessarily see a 13.1% increase in their property taxes. Because Orono has experienced growth in its tax base, the actual tax rate may only increase by one or two percent. This means taxes should remain nearly the same, or in some cases, be slightly less. The State of Minnesota has one of the most complicated property tax systems in the Nation. Another issue that is raising concern is talk about Minnesota's three -tier tax system." Bernhardson briefly explained how the three -tier tax system came to be. He said, "The Twin Cities /Metropolitan Area represents 50% of the State's population. The Metropolitan Area collects 64% to 66% of the State's taxes, but receives only 46% or less back. There is disparity. The money comes from this area and is distributed throughout the State. This is mainly due to the school aid formula, and to a lesser degree, the local government aid formula. The City of Orono has had all of its local government aids taken away because our per capita tax base is too great. Orono has also had all of its homestead credits taken away because our tax base is too strong to qualify under the • formulas." ( Bernhardson displayed information showing how - 1 -