The Crookston Ways & Means Committee met on Monday night following the City Council meeting inside the City Hall Council Chambers. The agenda included discussing 6 of the city’s department budgets, a proposal showcasing communication technology that can support our community from Megan Pederson of Vocal Fuel, and a preliminary levy discussion for the 2022 budget as the city prepares its final numbers.
MEGAN PEDERSON VOCAL FUEL
Megan Pederson from Vocal Fuel came before the board to present and announce the launching of their new app called “Community Voice.” The app is a new way for users to learn about events, businesses, and stores within their community. The goal is to get more people engaged with events and increase community participation.
The app will be customized to each user based on preferences the user selects while setting up their profile. The app is targeted towards people who are new to the community and people visiting the surrounding areas. The set date for the completion of the app is January of 2022.
If the city of Crookston decides to purchase it, the cost for the app would be $13,000 for a two-year contract with an initial $10,000 buy-in fee and $1,500 per year. The committee spent a lot of time discussing the presentation and asking Pederson questions. Ways & Means Committee member Steve Erickson gave his thoughts on the app. “I’ve been a big advocate for a community calendar and getting everyone on the same page,” said Erickson. “The timing isn’t perfect for it when we’re talking about cutting things and trying to come up with a levy. It’s going to be a tough budget year, and at some point, I don’t think we can spend the money on something like this if we don’t have it.”
The committee agreed to get it on the budget for the time being but will discuss if they want to move forward with the option as budgeting discussions continue over the next few weeks.
Crookston Police Chief Paul Biermaier and Lieutenant Darin Selzler of the Crookston Police Department gave a quick presentation of the department’s budget and discussed potential needs for 2022. The proposed budget would see an increase of $145,000 if it is approved in its entirety.
City Administrator Amy Finch talked about the department’s increases and needs. “The police budget’s major increases aren’t very major except for building and structures,” said Finch. “They do need to install some new security systems with new doors and cameras inside and outside of buildings. That increase is from $10,000 to $50,000, and the rest of the costs in this budget are fairly small with training supplies and things like that.”
The other main factors in the police budget that are driving the cost up for the 2022 year are salaries and severance pay for Chief Paul Biermaier’s retirement.
All committee members agreed the police department’s needs are a necessity, and they need enough money to keep their department safe and have the equipment they’ll need.
FIRE/EMERGENCY MANAGEMENT BUDGETS
Crookston Fire Chief Tim Froeber gave a brief presentation on the Fire Department and is asking for $29,000 more for the 2022 budget. The main increase for the Fire Department budget is with motor vehicles and other new equipment the department may need.
Like the police budget, all committee members are on board with providing the department the necessary money to stay safe and operate.
The Emergency Management Budget is unchanged for the upcoming year and is proposed to remain at $18,100 for the upcoming year.
COMMUNITY DEVELOPMENT BUDGET
The Community Development Budget is new for the 2022 year, and Finch discussed where the money would be coming from. “When we saw the professional fees budget tonight, it was reduced significantly,” said Finch. “One line was a former allocation given to CHEDA. That then funded the EDA portion of the CHEDA budget, so most of the numbers for this new Community Development Budget are coming from that Professional Fees Budget.”
Some smaller items included in the budget may be cut after discussing the preliminary tax levy, such as $20,000 set aside for other projects. The budget is still very new and will need to be fleshed out more once cutting to reduce the levy begins to take place.
The Valley Technology Park Budget is set to decrease for 2022 by $20,000 if approved by the committee. Money is being reduced for the budget through building repairs and maintenance, Janitor supplies, and other improvements. Finch added that the other improvement line was the biggest decrease from $25,000 this year to only $10,000.
PROFESSIONAL FEE & AUDITING BUDGET
The preliminary Professional Fee & Auditing Budget will see a decrease of almost $120,000 for the 2022 budget. Finch explained why there could be a massive reduction. “This budget for 2021 is where the $150,000 allocated dollars for CHEDA was sent,” said Finch. “It is a general fund expense, and we’ve reduced it to $35,000 this year, with $15,000 being the Northwest Minnesota SBDC contribution. The remaining $20,000 is to prepare for the transition of CHEDA with the Community Development Budget, and again this is something we can tighten down when we have to make budget cuts.”
Professional Fees within the legal budget are proposed to be increased by $61,000 for the upcoming year. The budget has been exceeded each of the last three years, so the proposal is to increase the budget from $122,000 to $183,000. Finch discussed more of the specific numbers within the budget and what was initially being proposed. “There was some concern that perhaps we did not budget enough for Civil expenses,” said Finch. “One of the issues we discussed was the last three years. The budget has remained the same since 2016. In the last three years, expenses have exceeded that amount, so we talked about how setting an unrealistic budget or revenue amount looks nice in the budget, but it doesn’t help you down the road. I proposed $115,000 for Criminal expenses and $56,000 for Civil, which accounts for roughly 400 hours or legal fees at our current rate of $140 per hour.”
Not all committee members initially agreed with the proposal, and Committee Member Wayne Melbye gave his thoughts on the Legal Budget and some concerns he had. “We noticed the number was over for the legal budget,” said Melbye. “We just wanted an explanation, and we got it. There are some criminal complaints up, and a lot of that accounted for 80% of the budget. The other increases were just smaller civil things that needed to be cleaned up, so once it was clarified, it made sense why we see that increase.”
After hearing more about the proposal from Finch, members of the committee started to understand the initial estimate. However, after plenty of discussions, the board decided they would review the information more at the next Ways & Means meeting on September 20 and discuss the matter more.
PRELIMINARY LEVY DISCUSSION
The committee ended the night by reviewing and coming up with a preliminary levy for the 2022 budget.
The initial look at the preliminary Tax levy does not look great, and committee members had a hard time coming up with a maximum percentage to begin at. It appears at this time, getting below a 10% Tax Levy will be a difficult challenge.
Committee member Erickson gave his thoughts on the preliminary budget and concerns he has for businesses. “I just look at a downtown business, and they get taxed at a higher level,” said Erickson. “At a 12% increase, that’s a huge amount for any business owner. It’s going to increase a lot of things, and we need to try and keep our businesses open, and we’re not going make it easier for them with what we are planning on setting the levy at.”
What homeowners and businesses would need to pay in taxes varies based on value, but a homeowner with a $150,000 home would be estimated to pay $793 in City Taxes per year at a 10% levy, while a $200,000 business would pay roughly $2,512.
Committee member Wayne Melbye also gave his input on the levy and what number he would be happy with. “If we could get it under 10% and get to 7-8%, I think that would be good,” said Melbye. “Folks need to know we’ve taken on a few extra costs this year that haven’t been in the budget before, and we need to get caught up, and then we can move on from there.”
A common goal mentioned by committee members was to potentially get the Levy down to 7% for the upcoming year, which will be $200,000 worth of budget cuts the committee will need to come up with. The committee will discuss whether this is a possibility and discuss more of where they can potentially cut at the next Ways & Means committee meeting on Monday, September 20. The committee has set the preliminary Tax Levy maximum amount at 10%, which would mean $80,000 worth of budget cuts will need to be made to hit the 10%.
The levy cannot go any higher than 10% once approved by the City Council at their next meeting on September 27, which means $80,000 worth of budget cuts will have to be made somewhere for the 2022 budget.
The next Ways & Means Committee meeting will take place Monday night, September 20, at 6:00 p.m. inside the City Hall Council Chambers. The city’s preliminary budget and preliminary Tax Levy will be up for approval at the next City Council meeting on September 27.