Park Rapids City Council votes to reduce 2011 levy
The Park Rapids City Council has decreased it levy for 2011.
An initial proposed levy at a 13.95 percent increase had many taxpayers questioning their tax statements. The city's Truth in Taxation hearing was well attended with citizens who were concerned about the increase.
The final budget has been adjusted and is a 6.55 percent increase over 2010. The final budget total for the city is $2,522,859. The tax levy is $2,113,061.
The majority of the increase is due to street utility projects.
The council had previously adopted an aggressive Capital Improvement Plan for utility projects to repair aging infrastructure. 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.