By MaryHelen Swanson

First there was one, then there were two, then there were three - three North Branch citizens showed up for the annual Truth in Taxation public hearing Monday night.

To an almost empty room, finance director David Stutelberg explained the 2006 budget and levy noting that the levy for next year will be a 7.64 percent increase over 2005.

That is unless the council makes a last-minute change at its Dec. 12 regular council meeting before final adoption.

As Stutelberg noted, when the proposed 2006 budget is adopted, North Branch will ask Chisago County to collect $2,957,061 from city taxpayers for city operations.

That is an increase of $323,559 or 12.29 percent more than the 2005 property tax levy.

Of that levy, $2,123,410 goes into the cityís general fund, $64,000 goes toward a 1998 Public Facilities Revenue bond, $48,000 to a 2001 equipment certificate, $55,000 to a 2002 equipment certificate, $90,000 to a 2003 equipment certificate, $56,410 to a 2004 equipment certificate, $80,852 to a 2005 equipment certificate, $120,000 to a 2001 fire hall bond, $35,889 to the EDA levy, $137,500 to the library/community center levy, $87,500 for park improvements and $58,500 for tax abatements.

Stutelberg explained that the impact on individual taxpayers varies depending on three things: tax classification, Estimated Market Value assigned to each property by the county assessor and the tax valuation formula set forth by the state of Minnesota.

With the county assessor updating the market values of property within the city, any change in market value can and probably will have the effect of increasing property taxes.

Hereís a formula for how North Branch calculates your property taxes:

The assessed value (set by the county) is multiplied by the tax formula (also set by the county) to equal the propertyís tax capacity value.

Then that property tax net tax capacity is multiplied by the cityís tax rate and you end up with what a citizen of North Branch will pay for the ìcityísî portion of their property taxes.

Additionally, in North Branch, taxpayers voted in November 2001 to bond for the construction of a new fire hall.

To figure what each taxpayer pays for that cost, the assessed value of their property is multiplied by the market rate levy, that total is also paid to the city.

Stutelberg showed that a $175,000 home in North Branch Subdistrict A (Old Branch) will pay approximately $8.54 less in city property taxes than in 2005. That same home value in Subdistrict B (Old North Branch) will pay about $37.55 less than in 2005.

In 2006, Stutelberg noted, there will be just one tax rate for everyone in the city.

He also broke down the costs of city services on that $175,000 home. On a per day basis, cost of administration, engineer, planning and zoning, police, fire, building inspections, civil defense, animal control, public works, parks, library, EDA, tax abatement, park improvements, library/community center and debt service is $1.87.

North Branch is expecting to receive $19,895,812 in revenue in 2006.

The expenditures are estimated at $22,475,145.

The proposed 2006 general fund levy is $2,123,410. The general fund includes general government, public safety, public works and culture and recreation.

Special revenue funds include economic development, TIF funds, rental properties, hockey arena (the city is just a host for this money), tax abatement funds, park dedication funds and a revolving loan fund.

Debt service funds include tax increment bonds, revenue bonds (EDA), general obligation bonds and revenue bonds (city) for the liquor store opened in 2000 and the new $11 million waste treatment plant.

In 2006, the city will levy $234,384 for the capital projects fund. Construction projects budgeted for in 2006 include several street improvement projects, Hwy. 95 bridge and the ESSBY housing project (although not officially approved yet).

Stutelberg also reviewed the cityís enterprise funds which include the liquor fund, sanitary sewer fund, storm sewer fund, trunk fund and sewer availability charges.

He noted that for 2006, there will be an annual increase to sewer users of 8 percent. There will be a 5 percent increase in sewer availability charges (SAC) and a 5 percent increase in the trunk fee.

He also noted that sales have exceeded projections at the liquor store and in 2006, $80,000 will be transferred from the liquor fund to the cityís general fund and $20,000 will be transferred to the sidewalk project.

Stutelberg concluded saying he and city staff believes the 2006 budget is modest, reasonable and fair. He noted that only one new position has been authorized - a public works employee whose time will be split 50/50 with public works and wastewater plant.

City Administrator Joe Lynch also added that NB was lucky this year in having its Local Government Aid (LGA from the state) increased.

The council will adopt the final levy next Monday night.

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