By Clark Natalie—
The February 13 meeting of the Harris City Council opened with a discussion with Senator Sean Nienow and Representative Kurt Daudt. The first issue was the change in the property tax, particularly the change from the Market Value Homestead Credit to the Market Value Exclusion.
The legislators explained that in the past, based upon the market value of a home, the state of Minnesota gave the taxpayer credit, paid to the taxing entity, whether a city or township. But in the past 10 years, it was fully funded only once which means that the taxing entity wasn’t getting the full amount of the proposed levy.
This was changed this past year to a Market Value Exclusion. It is referred to as an Exclusion because those properties valued in excess of $400,000 do not participate. Those less have a reduced taxable value, which affects the property tax amount.
Nienow and Daudt explained that when it was proposed, those with homesteads less than $400,000 should have paid about what they had paid the prior year. When the system was implemented, however, it did not work the way it was planned and some property owners saw an increase, they noted.
The legislators said that the commercial and agricultural property owners had increases for a different reason.
Commercial property, in addition to paying property taxes to the local taxing entity, also pays a property tax to the State.
When the changes were being proposed, this was to be eliminated. The final bill did not include that provision, so the local taxes went up and the state property tax stayed in place. The legislators indicated that will probably be dealt with in the next session.
The agricultural property was adversely effected with the change in green acres tax. Also, the base which agricultural property is assessed at is based on the sale prices of land in southwest Minnesota. This base is high, and not realistic in other parts of the state, they noted.
The legislators indicated that a move is trying to be made to give the evaluation of the value of the agricultural property back to the local assessors.
The legislators pointed out that although there was a deficit that was dealt with, the amount the state spent was actually 6 percent more than the prior year. This was made up with an increase in spending growth by 27 percent, it was explained.
Paul Christianson with Peoples Service was in attendance to discuss the increase in the service contract for the Water Treatment Plant (WTP) and Waste Water Treatment Facility (WWTF).
The contract which originated in 2008 calls for an adjustment each year in the amount based on the Consumer Price Index Urban (CPI-U). Peoples has used this as an index on all of their contracts.
Christianson said this year the increase is 3.4 percent. During the budget process, the Harris council had estimated an increase of 5 percent, so the requested amount was within their parameters.
The council asked what the increase would go to. Was it in labor costs for Peoples based upon more employees or just a raise for the present employees.
Councilor Judy Hammerstrom believed that the employees were union, so would have to have increases.
Christianson corrected her, saying that they are not a union shop. Although they pay an equitable wage, they are not on the high end of the industry pay scale nor the low. Peoples tries to stay in the median range of the pay scale. Christanson indicated that with the increase based on the CPI-U, the bottom line for Peoples will remain the same. Their costs have also gone up.
Councilor John Rossini asked if there was any negotiating on the increase amount. Is the 3.4 percent a set amount.
Christianson said that it was possible to go back to the president of Peoples to see if that amount could be lowered, and would do that and return next month with an answer. Christianson said Peoples Service always works with the clients they service.
During the discussion of the contract with Peoples, the quality of the Harris water was brought up. A local resident had complained about how often his filter had to be changed.
George Valvoda visited with the resident and was able to obtain one of the resident’s filters. They are now analyzing what has been trapped.
Hammerstrom said other residents had complained about the quality of the water. Christianson asked if a complaint had been filed with City Hall, because if not, there is no way to investigate the problem.
Hammerstrom said no complaint had been made, it was an observation made in a conversation.
Mayor Diane Miller interjected that Harris has always had a problem with water quality, even before Peoples Service came on board. Miller said that they used to have to change filters every week.
When the new WTP was getting ready to go into service, Miller had their residential pipes back flushed to clean them. Then ran a new service line from the water main to her residence.
Now, Miller only needs to change the filter every three months. Many times the problems are not only in the city pipes but also the residential pipes.
Public Works employee Jonathan Bloom tendered his resignation effective last week. Mayor Miller assured everyone that there is a back up should there be snow, and that the roads will be plowed.
Councilman Randy Carlson thought this would be a good time to look into the possibility of contracting out the plowing and grading, rather than hiring another part-time public works employee, to see if contracting out will actually cost less than an employee.
Rossini wondered if the city would be able to find someone who was qualified that would be willing to work part-time at the hourly rate for the position with no benefits. Hammerstrom believes that with the economy the way it is, there would be someone qualified who would apply for the job.
Miller noted that if the pay scale was increased, that would mean all the employees would have to have a pay increase to remain in compliance with pay equity requirements.
It was decided to put together a Request for Proposal to contract for snow plowing and grading. City Engineer Chuck Schwartz will get copies of another town’s contracts to help establish the parameters for the contractors to bid on.
The Chisago County assessor had contacted the city clerk about a request by Big Daddy’s restaurant. The upper floor is being used as an apartment, and the owners of Big Daddy’s want that portion changed to residential, because it would lower the tax amount.
The assessor had contacted the city to make sure this was acceptable.
The mayor pointed out that residential units are not allowed in a commercial structure, so the owners are not in compliance with zoning issues.
It was decided to let the assessor know that it was not acceptable to change a portion of the building to residential.
The next step was to notify the owners, in writing that they are not in compliance, giving them the option to either stop renting the apartment or submit a request to change the zoning restrictions on commercial properties.