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Hugo City Council Meeting Minutes for December 6, 2021 Page 6 of 7 Wobse explained the City maintains a flat tax rate but tax collections increase when property values increase. In 2022, taxable market value increased by $155,994,500 (7.7%). To keep the tax rate the same the Council adopted a preliminary tax levy of $9,590,175 in September, 2021. Washington County uses this number when calculating the proposed tax notices mail several weeks ago. She next reviewed what made up the City’s proposed levy beginning with City’s three bond issuances equaling $16,505,000. The Improvement Bonds of 2011 were to pay for street projects, the Capital Improvement Bonds of 2020 were to finance the Public Works facility, and the Tax Abatement Bonds in 2021 were used to finance Lions Park. These three bonds resulted in $1,047 per capita in the City of Hugo, which is less than the average statewide of $1,876 per capita. The levy to pay for the principal and interest on these bonds would be $989,465 for 2022. Two years ago, the City began to levy $1.1 million for street improvement projects. The City is now able to fund these projects without borrowing. The project for 2022 will be Oneka Parkway. Included in the budget was $240,000 in the Equipment Fund Levy, and $278,788 for the Stormwater Levy. The Special Parks Fund Levy used to maintain neighborhood Park will remain at $92,000 until the Council changes it. The Firefighter Relief Levy was at $21,444 with no mandatory contribution required in 2022. She explained the budget technique used for the General Fund was to conservatively estimate revenues and to budget for expenditures that may or may not occur, which usually led to a surplus. Included in the general fund was personnel, which included 25 full-time positions and two vacant positions. The Public Works Director was recommending the Public Works Department be divided into three divisions with a superintendent position. This would take more consideration and approval by the Council. A new administrative intern position was also budgeted for. Salary survey market data showed Hugo to be less than 4% from the minimum and maximum ranges. The proposed budget contained a 4.55% Cost of Living Adjustment and a few page grade adjustments and step increases. Insurance premiums were only increasing by 3.33% but employee deductibles were also increasing. Staff was requesting to use a portion of the premium savings to offset the increased deductibles. The General Fund Budget also included $200,000 for budget stabilization. She reviewed revenues saying the vast majority of the budget was funded with property taxes. Most other revenues remained at 2021 budgeting levels. The City will receive its annual share of the fiscal disparities pool which will lower the taxes paid by residents by $924,336. The City’s urban tax rate will remain unchanged at 39.294%. Wobse reviewed the 13 different tax rate and where the average tax dollar goes. The City’s share accounts for 28% of the total tax bill. She provided information on state tax programs and encouraged residents to apply. Mayor Weidt opened the public hearing Ellen St. Sauver, asked about a huge increase in the tax amount owed on vacant land she owns in Hugo. Staff was directed to investigate the reason and follow up with her. There were no other comments, and Weidt closed the public hearing.