International Falls City Council sets 2013 levy at 2012 level

The action was taken during a special session following a moment of silence in recognition of Riley Burnell, a Falls police officer and Koochiching County deputy, who was killed last week in a car crash.

The preliminary levy must be set in September and finalized in December. The levy can be reduced before December, but may not be increased.

Councilor Paul Eklund said that the recommendation not to increase the 2013 levy over the amount collected this year is based on what other governments are setting their 2013 levies at, the loss of the state’s homestead credit program, and because other services in the community, including sewer rates, are increasing.

Eklund, who served as mayor pro tem Wednesday in Mayor Tim “Chopper” McBride’s absence, said the zero increase over this year means that no line items in the budget will be increased for 2013.

Councilor Cynthia Jaksa, chairman of the city’s Finance and Legislation Committee, said the budget team, whom she complimented, simplified the budget in an effort to give a clearer picture of the city’s budget. Items the council cannot control, such as the Fireman’s Relief Association and payroll handled for other entities among other items, have been taken out of the budget. Those items represent $634,457, she said.

Jaksa also reported that expenditures have been grouped. “It’s helpful for people to understand the general fund, which funds the core operations of the city,” she said.

The budget, she said, includes draw downs of the fund reserves.

Meanwhile, Jaksa noted that the city receives $3.7 million in local government aid from the state. She said the LGA comes from the state’s general fund, which is “Money from us — all residents of the state from sales ad income tax. We are a major receipter” because the area has low income and is not a major retail center.

Jaksa said the state froze LGA at its current level for three years when it resolved a budget shutdown, with 2013 marking the second year.

However, she said, because of increasing costs the amount will “represent a slippage in purchasing power.”

The “battle over LGA is critical,” she said, referring to legislators who represent rich suburban areas which do not receive much LGA. “We’ve already lost half a million over the last few years. If we get cut again it will impact the delivery of services and/or property taxes.”

The answer to the city’s finances, she said, is to create “vibrant and successful economic development that will grow the tax base and bring jobs.”

The council is expected to meet with department heads as the budget is developed.