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The Main Avenue street and utility project accounted for much of the increase in the proposed Park Rapids levy for 2011. The council is grappling with whether to continue capital projects at an aggressive pace or slow down. (Anna Erickson / Enterprise)

City council asked to wait on street utility projects

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A proposed Park Rapids levy would increase by 13.95 percent in 2011, the majority of the increase stemming from street utility projects.

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The Park Rapids City Council still has an opportunity to lower the levy, though, after hearing feedback from the public Tuesday at the Truth in Taxation hearing.

The proposed levy for 2011 is $2,259,686, up from $1,983,127 in 2010. The general fund remained rather flat, with $1,482,245 proposed for 2011, up from $1,406,032 in 2010. The majority of the increase is in bond/debt service, with $600,400 proposed in 2011, up from $411,800 in 2010.

The council had previously adopted an aggressive Capital Improvement Plan for utility projects to repair aging infrastructure. Several people asked the city to slow down on utility projects in the next few years until the economy improves.

"I just hope that in the future you take a look and maybe don't do these projects now," said Tiny Blanchard.

Alan Kueber said he has lived in Park Rapids for 50 years and he is concerned about the way the City Council is spending money.

"How many of you people have looked at the (for sale) signs along the road?" he asked council members. "... I wish you would just slow down a little bit."

This summer was a busy one for major projects, with Main Avenue and an area in southwest Park Rapids. These projects contributed to a 45.8 percent increase in debt service for the city. In 2010, debt service was $411,800. This dollar amount jumps to $600,400 in 2011.

The council had scheduled another utility project in the Riverside area of town but will be discussing whether to move forward or hold off on that project at a future meeting.

A reason taxes will be higher for more people in the city in 2011 is because the Main Avenue project can't be assessed to property owners in the project area until after it is completed, said city administrator Bill Smith.

It is a two-year project and will be assessed to property owners in the project area in 2012.

Another reason the proposed levy increased for 2011 is due to unallotment of Local Government Aid, he said.

After unallotment, LGA is estimated to be 33.09 percent less, he said. The proposed LGA for Park Rapids in 2011 was $451,727 but now it will likely be $210,745, he said.

Property owner Nels Peterson sympathized with the council.

"When you review the numbers it's actually very flat," he said, referring to the 2011 levy after taking out the construction bonds.

He is in the construction field and said he has felt the recession.

"If we want to maintain our standard of living I think we need to buck up and pay what the city is asking us to pay," Peterson said. "I think it's OK. It's a city worth investing in."

Steve Larson also said he understood the city's reasoning for the utility projects but said, "unfortunately it has fallen at an inopportune time."

He acknowledged the pressure for services in Park Rapids but thought the city needed to work more like a business.

"As a business ... our books have to be dealt with in a certain way," he said.

Steven and Sherri Kamensky were unable to attend the meeting but wrote a letter to Mayor Nancy Carroll about their concern about increased property taxes from the city.

"Our taxes are expected to increase 14.7 percent while our taxable market value declined $3,600. This increase follows a 5.7 percent tax hike from 2008 to 2009," they wrote.

The Kamenskys agreed to be annexed into the city of Park Rapids in 2004 and experienced a sharp increase in property taxes. City services of water and sewer are unavailable to them.

"We understand that property taxes support city and state services and are a necessary part of a functioning government," they wrote. "We are more than willing to pay our fair share. However, it does not seem fair to get a 14.7 increase in one year while not receiving the same services that other residents get."

Councilwoman Sue Tomte said she is seeing an increase in taxes too.

She applauded citizens for attending the meeting and said input helps the council make decisions. She wants to see more combining of services between agencies in the future and thinks that is a possible way to save money in the future.

Councilman Paul Utke, who lives in town and has a business on Main Avenue, said "I just about had to call 911 when I opened my tax statement."

Only three people attended the county's Truth in Taxation meeting Wednesday night. Their questions were mainly about valuations.

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Anna Erickson
Anna Erickson is editor of the Park Rapids Enterprise.
(218) 732-3364
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