Otsego increases city levy 2.74 percent

by Dawn Fedderson-Poindexter

Contributing writer

The 2013 Otsego property tax levy is projected to generate $4,377,910 for the city, reflecting a 2.74 percent increase, or $116,910, from property taxes levied in 2012.

Nearly half of the increase, $57,765, is for costs dealing with storm water. Much of the rest of the increase, $48,280, will go to the general fund, which accounts for most of the day-to-day operations within the city, such as administration, public safety, parks and recreation, etc.

“By far, the vast majority of the money from the levy is used to support general fund operations,” said Gary Groen, Otsego’s finance director.

The impact of the property tax levy per household depends on a property’s value, which is set by Wright County. By and large, most properties experienced a decrease in value, with the majority of the decreases being seen in low and moderate value homes. This created a 7.73 percent decrease in tax capacity for Otsego in 2013. By comparison, the city experienced an 11.61 percent decrease in tax capacity in 2012.

“Now that home prices have started to moderate, we’re hopeful that we’ll see an increase soon,” said City Administrator Lori Johnson.

The total budget the council approved for 2013 is $5,263,534, $3.7 million of which is slated for the general fund. The general fund budget reflects a 3.97 percent increase in costs, $55,000 of which is expected to be offset by revenue from new and increased parks and recreation programming. By comparison, just $2,500 was expected from park programs in the 2012 budget.

“The City Council recognizes that parks and rec is an important part of a healthy, vibrant community. The council and residents would really like to see Otsego have more of an identity and they view this as a way to go in that direction,” said parks and recreation manager, Ross Demant.

Demant says they are looking at several ways to accomplish this, including expanded programming, more special events, possibly offering a day camp this summer, and exploring more partnerships with local businesses.

In other matters

In other matters, the council heard from City Engineer Ron Wagner about a $50,000 refund the city was going to receive for services they paid for during the overhaul of Highway 101 that were beyond the scope of what they had agreed to.

At the Nov. 26 meeting, the council received word of an alleged liquor license violation by Cowboy Jack’s. It had been reported that the establishment was serving alcohol after 1 a.m. The council had agreed at its last meeting to allow the sale of alcohol at restaurants and bars until 2 a.m. However, the alleged violation took place under the old law. The matter is being investigated.

Also at the meeting, the council was persuaded by Demant to purchase a wide area mower, which had originally been budgeted for 2013. Demant informed them that the price of the mower would be increasing by as much as 10 percent next year, so haste was needed to get a better price. The new mower will perform work currently being done by an outside contractor. The change is expected to save the city $7,000 a year.