With fall approaching, preparations for 2014 are getting underway in South Haven.
The city council began budget discussions on Tuesday, Sept. 3, and approved a preliminary levy during the meeting.
Those preliminary numbers have the tax levy increasing by 3 percent, or $3,278.91, to a total levy amount of $112,576 in 2014.
Because the city has a population under 500, the council could have set its final levy and budget during the meeting, but council members decided to wait until December to determine final numbers. The preliminary levy can be decreased before the final levy is approved in December, but cannot be increased.
"We can’t go up. We can always go down," said Mayor John Lemke, noting that waiting until December to set final numbers would allow council members to see a few more months of actual spending in 2013 to help determine needs and priorities.
If a final 3 percent levy increase is approved, it, along with an extra measure of local government aid expected in 2014, would reflect a budget of approximately $179,817 according to rough numbers compiled by City Clerk Carol Banken. That would be about a four percent increase over this year’s budget of $172,623, but Banken cautioned that the actual numbers will likely be different.
"This budget in September is just a rough guess," said Banken.
The council did not review the budget in any detail during the meeting, but will hone final numbers as the end of the year approaches.
Banken added that some costs, such as police rates and League of Minnesota Cities dues, are going up in 2014.
She also expected there to be other increases in the cost of doing business across the board. The city will be reviewing its contracts to see what rates might be rising before the end of the year as well.
Depending on those variables, and if the increases are manageable, the tax levy increase could be reduced or even eliminated in December.
Some good news is that the city’s local government aid is expected to increase by $1,870 to $34,496, helping to offset any levy increase that might be necessary.
Rental rates for the post office are also expected to increase by a small margin next year, and the city’s new tax-exempt status regarding purchases for some equipment items could also result in savings.
"If you have a population under 500 (the tax exempt status) probably won’t make that big of an impact because we don’t have a lot of expenses. But cities like Annandale could take into consideration that they’ll be saving money on the tax end of it," said Banken. "We don’t have major expenses here like a bigger city might. We don’t have a police force, for example. But we do have different things we purchase like paper, pencils and computers (that could result in tax savings)."
On a related note, Banken had previously mentioned to the council that some consideration of razing the corner building next to the municipal liquor store be given, but she noted during the meeting that budgeting for that project was not feasible at the time, as it would increase the levy by an unacceptable amount.
Other items
In other business, the council:
■ Approved a bid of $1,200 from Water Tower Clean & Coat of Wisconsin to clean and inspect the city’s water tower.
That was the lowest bid of four received, which included $1,600, $1,700 and $2,7010 amounts, and also did not require a multi-year commitment.
Councilor Russ Christinsen pointed out that $1,200 was the same amount the city paid for the same work several years ago.
"Let’s give them a shot and see how they do," said Lemke. "Four hundred bucks a year is quite a difference."
The council hopes the work can be done before mid-October.
■ Briefly discussed the opening of the state’s MNsure health insurance exchange system in October, which meets the requirements of Obamacare.
Banken explained that because the city has fewer than 50 employees, it is not required to offer insurance through the new health care law, but she added that details about the law have been difficult to come by.
"I haven’t gotten anything from the League or the state because it’s so up in the air," she said.
■ Discussed erecting a sign at the city’s brush site limiting the material that can be placed there and clarifying that the site is only for the use of city residents.
The council also noted that violation of the city’s ordinance regarding the site is a misdemeanor resulting in a $75 fine.
■ Heard that the fire department handled nine rescue calls and four fire calls during the month of August.
Council members also approved a quote of $1,445 for seal coating the fire hall parking area.
■ Heard from councilor Kandice Voigt that there were two rentals of the city hall in August, and so far there is one paying rental scheduled for September.
Council members also approved the expenditure of $550 to $600 to place rock between the cement area behind city hall and the alley.
■ Set a public hearing for delinquent utilities for 7:15 p.m. during the Tuesday, Oct. 1, council meeting.
■ Changed the November council meeting to Wednesday, Nov. 6, since councils cannot meet on the first Tuesday in November, which is reserved for elections.
■ Acknowledged a donation of $825 from South Haven Fire Relief gambling funds. That money was split, with $450 going to South Haven Days and $375 going to the girls softball league.
■ Approved the payment of $355 in annual dues to the League of Minnesota Cities.
■ Lemke reported that it has been "business as usual" at the municipal liquor store as far as sales through August. He also noted that the DJ Funkee Monkey was scheduled by the store to entertain on Saturday, Sept. 7.