Saving Money by Absorbing Clerk Duties in City Administrator Position

Isanti saved $32,000 by replacing our Clerk with assistant clerk and paying our Administrator $7000 more to take on statutory clerk duties... Council Member Larson and Lundeen objected to this at last nights Council meeting. If we did not pay our Administrator to do the Clerk duties we would have had to hire another position. 


It is easy to score political points by opposing what appears to be an expense but it is really a savings of $32,000 because our previous clerk cost the City $89,000 in salary and benefits... we replaced this with an assistant clerk/hr position costing us $50,000 salary and benefits.... take away the $7,000 for the legally required statutory duties of a clerk that were absorbed by the City Administrator and you get to our total savings of $32,000. If we did not take these actions we would have lost money...


I found it incredulous that those that have wasted taxpayers money so frivolously in the past would make such an argument. Leadership entails educating the public not simply bending to uninformed opinion....

Taxable Market Values

This graph shows just how bad it has gotten as our overall city tax base has started a rapid decline. We have lost over $137,000,000 or 37% of our tax base from the all time high.

This being said I think the real question needs to be asked is why did the County continue to increase everyone's property values in 2007, 2008 and 2009 when it was clear the real estate market was collapsing then? This gave a false impression of City wealth and made it very difficult every time I said things are very tough and we need to cut cost and keep our long term spending in line.

As you follow the bell curve year to year on each side of the high point matching very closely and can be used as a harbinger of what is yet to come....

This cold reality is being faced by all communities in regions like ours that grew so rapidly....

A Quick Note on Property Values

County told us property values would drop 2% and we budgeted accordingly .. now they tells us 22%... I have a lot of late nights coming.. I will not raise your taxes as most other cities, counties and school districts will do. I believe if your property value goes down so should your taxes... I will be redoing the budget over the next 2 weeks to cover the hundreds of thousands of dollars we will be losing... I will then present these items to the City Council for approval.... I have a lot of work ahead of me so please be patient if I do not respond as quickly to request... This is why I developed a strong fund balance and long range budget plan that handles just such problems....

State Budget Update

http://www.startribune.com/politics/blogs/121895204.html

A few of the Audit Stats

City Admin is roughly 30% lower than our peer group of cities and is 21% of the General Fund Budget

Public Works is 43% lower than our peer group of cities and is 15% of the General Fund Budget - Water and Sewer Fund pay the rest of Public works cost

Park & Recreation is 46% lower than our peer group of cities and is 6% of the General Fund Budget

Public safety is slightly more than our peer group at .05% higher than our peer group of cities and is 49% of budget

Economic Development increased dramatically last year as we put more resources into this area as we are 450% higher than our peer group of cities but it still only accounts for 5% of our budget. 

Total City operations are 16% lower than our peer group of cities

The most exciting aspect is our continued reduction of non-enterprise fund debt which is the debt we have beyond the water/sewer fund debt.... this is the debt we have the most control over year to year. Debt per capita in this category has gone from $1,904 per man woman and child to $689 - a  64% reduction of debt per capita..... 

The water fund is in balance now after a number of actions over the past year and only the sewer fund is out of balance and will need a rate increase to pay the bad debt left us from the wild days of rapid residential growth. 

City Audit Report

The City Audit Report once again shows how our Long Term Financial Plan is working extremely well. The only bad fiscal issue we have to fix is the leftover mess from the previous Mayor and Council with the East 65 expansion. We will be fixing that at the next Council meeting.

All General fund budget items and City operations are running more efficiently than our peer group of cities. Our administration cost us much less than our peer group of cities. I will be writing more about the exact numbers but wanted to notify the public that at Tuesday Council meeting we will be going over the Audit Report. 

2012 Property Tax Valuation

My home value according the County's valuation has dropped over 30% in the last 3 years.... I expect a further drop for 2013 then hopefully the property market in our region will stabilize.....

Interesting Cambridge Isanti Comparison

Industrial/Commercial development has to be done right...... even with the commercial development in Cambridge their Property Tax Rate is over 15% higher than Isanti's rate. When I was elected Cambridge's Property Tax Rate was lower than Isanti.... the past few years they have steadily increased their taxes as we have lowered.... just an interesting fact to ponder....

Pedestrian Bridge Project Needs to End

I asked the Council last night to end the Pedestrian Bridge project but lost the vote 4-1. When this project started I had promised I would only do it if we received all the federal trail funding and that no City Taxpayer money would be used to build this project. All the Federal funding did not come and there would not be enough park fund money to cover the $370,000 plus city portion which means taxpayer money would need to be used.

I also believe we live in a different time. The rules around park funds is that it can only be used for new park land or equipment but the interest we make off this money can be used. The interest income form this money is over $126,000 and can be used to make up for the lack of state funding Isanti is owed which would allow us to balance our budget without having to raise taxes.

The second part of this is that there is a $22,000, cost to the City, under ground power line going through Blue Bird park that the Park fund could pay for if it were not bankrupted by the Pedestrian Bridge. Now the $22,000 has to come from taxpayers.

3rd part revolves around $60,000 plus loan from the City General Fund, taxpayer money again, that would have to be issued to the park fund to pay for the bridge.

4th issue is if we do the pedestrian bridge the city will not be able to do any park and recreation activities for at least 5 years according to my best calculations....

Lastly if we cancel the Bridge project the City can sell the House and property we bought for right of way adding another $100,000 plus to the City....

$308,000 worth of reasons to cancel this bridge.... At a time we are looking at cutting services this project makes no sense

Homestead Tax Credit

State Legislature should either end the Homestead Credit or pay for it. These hypocrites take credit for tax break but cities, schools and counties now pay it. There is great talk about ending unfunded mandates and cutting aid to cities.... this new legislator needs to live up to the hype and be honest about the Homestead Tax Credit....

Township and City Tax Base of Isanti County

      I thought it might be interesting to share what percentage of the County's overall tax base each township and city represents. I have listed the townships first followed by the cities - you will see the name then the percentage of the total tax capacity for each entity.... It gives a better understanding of how much tax capacity is in each community and whose taxpayers are paying the bills.... All of us pay County taxes and those of us in the cities pay our own city taxes for city services such as police, planning and other services the county provides to township residents at no additional charge. I try to make this point when the County ask the City for more money from us when at the same time they do not ask the townships for similar contributions.

 Athens 5.53% 

 Bradford 8.93%

 Camb Twn 6.98% 

 Dalbo 2.11% 

 Isanti Twn 6.32% 

 Maple Ridge 2.58% 

 North Branch 3.35%

 Oxford 2.89% 

 Spencer Brook 5.02%

 Springvale 4.14% 

 Stanchfield 6.49% 

 Stanford 6.49%

 Wyanett 7.22% 

 City of Cambridge 21.07%

 City of Isanti 11.41%

 City of St Francis 0.03%

 City of Braham 2.52%  

The Cities of Cambridge and Isanti contribute roughly a third of all taxes to the County.

The State Proposes to Cut $285,308

$285,308 is being proposed to be cut by the Senate Finance Committee from Isanti's Local Government Aid and Market Value Homestead Credit (MVHC). Cambridge looks to be cut over $550,000 from their promised funds. The cuts themselves are terrible but the hypocrisy of both political parties regarding the MVHC makes me angry. The State gives the homestead credit on taxes but no longer pays for it... they have forced the Cities, Counties and School Districts to pay for a tax break they take credit for.... This is a huge unfunded mandate that hurts local government but makes state legislators look good.... I hope our legislators will either fix this or at least be honest about it.....

Community Center Reality

The Isanti Community Center brings in $8,000 in revenue but cost the City $20,000 to operate.... is that worth it to the public.... This does not include the $5,000 or so needed for capitol replacement needed each year.... $25,000 for our Community Center.... One of the many topics we will be discussing as a community

2011 Budget Update

When we started this budgeting process I predicted we would need to be at the 2006 spending limits.... well we are right on the number or actually .008 from the number so pretty darn close.....I think you would be hard pressed to find any government entity that can boast this type of budget discipline and reduce actual spending over 5 years.. .not a cut in increase but an actual dollar for dollar cut.....our tax levy is also looks like a ski slope going from 74% in 2005 to 54.47% for 2011.... we actually cut our levy rate by 2.5% from last year.... again the best i have seen out there is keeping the rate flat and many of our neighbors have increased their property tax levies.... Now there is real pain in this budget and that will been seen even more so as time goes on but with declining property values and state cuts we have to make the painful systemic cuts now to lessen the impact later.

The Council will be finalizing the 2011 budget Tuesday night and we will be discussing a possible cut of a police officer position due to the police union's insistence to be compensated at a higher rate than all over City workers. The City might be able to float a year with this inequity but the longer we wait to fix the problem the more expensive it will be and the greater harm it will do to City moral.

The biggest saving to the general fund budget was refinancing our City Debt with our higher credit rating - saving us over $100,000 a year.... We have this better credit rating due to our strong fiscal discipline and maintaining a prudent fund reserve to ensure we can be self sustaining as a City. If we leave this path for feel good spending measures we will soon be in dire financial straits.

There will be much more to say after Tuesday's Council meeting. I hope everyone understands where we are at from a budget stand point. The next two big issues are the sewer and water fund balances that were used by previous Council's and Mayor to fund the irresponsible rapid residential development. These are loaded with unsustainable debt and we are obligated to fix this problem just as we did with the our general fund budget crisis. The option for these two funds however are very limited and the answers seem painful... this will be one of the top topics at our upcoming community meetings....

Tweets on State Budget Deficit

MayorWimmer George Wimmer 

$6.2 billion deficit does not include the school shift.... so are we not really talking roughly $8 billion deficit?????

23 seconds ago Favorite Reply Delete

MayorWimmer George Wimmer 

$6.2 billion deficit over the next two years for the State of Minnesota.... all local governments and school districts are on their own

2 minutes ago 

2011 Budget

We will be passing the 2011 Budget and Levy at the next meeting.... I will be writing a lot about this in the coming weeks..... a few points.... The police budget has gone from 24% to 32% of the budget since 2007 and we have cut general obligation debt payment from $515,000 to $400,000... unfortunately the development debt racked up by previous Councils and Mayor is weighing us down and has to be dealt with - only painful options exist to fix this problem.... I fought hard against this wasteful spending but now have to deal with the bad choices of others..... a lot of details to come in the following weeks.....

Business Development by the Numbers

28 new jobs ( 50% are $20 or more an hour) and $3,202,648 in new tax base generated by our recent economic development.

 $109,000 in new property taxes ($34,752 City Portion) will be generated in our community for the City, County and School District.

$33,000 in Park and Recreation fees

$92,532 in SAC/WAC fees

$24,100 in Trunk Utility fees

$36,000 in Collector Street fees

11,082 in Signal Light fees 

First year of tax and other payments to the City is $231,898. By year 4 the total $350,000 in economic incentives will have flowed back to the City. 

Interesting Approach to LGA by Minneapolis and St. Paul

The story discusses Minneapolis and St. Paul's approach to LGA - they state and budget for the full amount even when everyone knows no city will get anywhere near the full amount. Responsibly budgets such as ours in Isanti has to reflect the ever dwindling amount of state dollars we are suppose to get. We have to pay our taxes to the state but when the state over spends we at the city level are forgotten. The LGA flip I designed and implemented with Council approval has given the City financial stability in these terrible economic times.

http://www.startribune.com/politics/local/102741954.html?elr=KArks:DCiUnP::DE8c7PiUiD3aPc:_Yyc:aULPQL7PQLanchO7DiUr

Isanti only City in the County with no tax Increase

The City of Isanti is the only city in our County with a 0% tax increase. While others are raising taxes we are able to protect our taxpayers because of our fiscal planning.

City Budget News

We passed a City Budget with a 3% cut in spending and a ZERO increase in the property tax levy..... Another great victory for my budget plan. We have been able to make the tough decisions to cut cost so we can save our taxpayers hard earned money.

I am a budget and planning guy and if we do not keep a tight hold of our expenses then cost and taxes will run wild as they had previous to becoming Mayor. Some of the decisions we have had to make are not popular but we must protect our resources as this Great Recession continues to hurt our City's families.

I would rather make sure our City is prepared for the future and the difficulties we face together than trying to make grandiose promises in a vain hope to win a single election - the future of Isanti is worth a great deal more to me.