|
MINUTES OF THE
<br /> ORONO CITY COUNCIL MEETING
<br /> September 26,2022
<br /> 6:00 o'clock p.m.
<br /> 6. ADOPT 2023 PRELIMINARY TAX LEVY—RESOLUTION NO.7291
<br /> Finance Director Olson noted the City must certify the Preliminary Tax Levy to the County by September
<br /> 30.He shared the final levy and budget will be approved on December 12,2022 and public input will be
<br /> allowed prior to the final adoption of the levy and budget. He showed a slide on screen regarding tax and
<br /> tax levy history,noting the average property in Minnesota pays 30%of the property tax to the City,30%
<br /> to the schools,and 28%to whatever County they are in. Orono's share of the tax levy is only 16%with
<br /> 38%going to the County,and 39%goes to the schools. Olson stated the City has always been
<br /> conservative on the tax levy,taking a much smaller portion than cities around Orono.This year the total
<br /> levy is proposed to be$8,387,000,the General Fund levy is$5,641,000(13%increase mostly due to
<br /> wage increases in the unions),and he spoke about the pavement management levy which will bring them
<br /> to the full funding needed to maintain roads in Orono.This City Council has been very dedicated to
<br /> improving parks and the park levy is increasing to$150,000; Olson noted that fund was at zero 10 years
<br /> ago with nothing spent on parks other than mowing and portable restrooms.He shared about the
<br /> community investment fund,bonds,and debt service which is a savings of$416,000. Olson shared it is a
<br /> sizable increase overall but he thinks it is justified for where Orono is going.He stated based on the
<br /> increase in property values this year the tax capacity is about$50,000,000 which is a 21%increase.Right
<br /> now they are estimating the tax capacity rate for Orono will actually decrease slightly by.04.He
<br /> explained if one owns a property in Orono that does not change in value they would see a very small
<br /> decrease in taxes. If a property increased by 5%in value they would see increases in property taxes,for
<br /> example$22-23 on a$250,000 and$210 on a$2,000,000 home in the City share of taxes. Olson showed
<br /> a slide on tax capacity since 2016 which is trending downward over time.
<br /> Mayor Walsh noted the City has the road budget in there(they do not assess for roads),as well as the
<br /> roads and sewer budget,the parks budget,police,and technology.Looking at Long Lake,for example,
<br /> who is at 36%to Orono's 16%,they do not have any of those things in their budget.
<br /> Olson shared a chart comparing taxes between cities and the good job Orono has generally done keeping
<br /> taxes low.He showed the general fund tax levy noting Orono is around 52%,Medina is over 70%,
<br /> Mound is 67%, Spring Park is over 80%. He noted Orono has done a great job finding other ways to
<br /> finance the general fund budget through service contracts for police and public works which allows a
<br /> bigger,more robust department,and provides services the other cities could not afford on their own.This
<br /> keeps Orono's budget much more stable because they are not completely reliant upon taxes.Many of the
<br /> cities on the graph get some sort of State aid and Orono has not received State aid for 20 years.
<br /> Gabriel Jabbour,985 Tonkawa Road, appreciates Mr.Olson's presentation. As they know,one goes
<br /> through a tax bill and noted to do anything at the State level will take a long time,planning,getting the
<br /> right legislator to think the right way,and getting something done at Hennepin County is very difficult.
<br /> He stated Orono is picking up quite a bit of Hennepin County,Minneapolis,and other areas.The only
<br /> other area they could make a difference is in the local,City government. Mr.Jabbour said the City will
<br /> receive close to 21%more taxes out of Orono residents than the previous year.With property values
<br /> going up they do not need to change the number that they multiply the value to get the taxes. Mr.Jabbour
<br /> would say the reason it is going up is supply and demand and the good citizens of Orono investing in their
<br /> own property. If the whole City doubled and the City kept the budget the same,the levy number would go
<br /> down in half(he does not mean the taxes).He noted Orono is definitely unique with tons of great houses
<br /> that require very little service which are a great cash cow for the City.The reason Mr.Jabbour is asking
<br /> the City Council to reconsider the amount of money they are making the budget to be,none of the pie
<br /> charts really matter to the people, it matters how much more money is coming out of their pocket.Mr.
<br /> Jabbour stated his house went from$2 million-something to$3 million-something,in using the same levy
<br /> Page 7 of 13
<br />
|