Tag Archives: Greg Boe

Radio silence, Truth in Taxation edition [UPDATED]

The City of Chaska Truth in Taxation hearing is on Monday, December 5.  As was noted before the setting of the preliminary levy in September, the City has been slow to post final budget information online.  Certainly, one would think this information is put together and available by now.  So, get it out there for people to see and read!

UPDATE 12/4, 9:00 p.m.:  Still nothing posted on the city’s website.  Just not acceptable.

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Downtown Open House reminder and other news

The public open house to review the initial output of the Downtown Master Plan is on Wednesday, February 16.  The event will be held at the Chaska Community Center Community Room from 7-9 p.m.  This event is meant to be the primary means by which the public will get input into the task force’s final report, so if you are interested in the future of Downtown Chaska, please attend.

In other news:

  • At its Monday meeting, the City Council settled on a new policy for determining the Mayor Pro Tem.  The longest standing Council member (with a minimum of two years on the council) will hold the position, with the position rotating yearly to the person with the next longest seniority on the Council.  As Chris Schulz was the Mayor Pro Tem in 2009-2010, the Council named Rick Ford as the Mayor Pro Tem for 2011, with Greg Boe on tap for the position in 2012.
  • The city completed its Michael Foods noise analysis last week.  The facility was within ordinance on an average basis, but there were spikes of noise that were in violation.  The city will be working with Michael Foods to see if those spikes can be eliminated.
  • Finally, I am pleased to report that I have been selected for participation on the Park Board.  There are a lot of exciting projects ahead, and I look forward to helping continue the city’s excellent parks and recreation facilities and programs.  If you have questions or concerns about parks and rec issues, don’t hesitate to contact me.

Kicking the can down the road

Last night, the City Council voted 5-0 to approve an increase in the property tax rate designed to keep the 2011 tax levy at the same level as 2010.  

Much of the Council’s discussion related to the issue of personnel costs, which have been budgeted to increase 1.5% in 2011.  Unfortunately, much of that discussion involved setting up strawmen (that critics were demanding drastic cuts in salary or personnel numbers) and knocking them down.

The city’s budget does nothing to address the long-term financial issues that this city faces.  Even with the tax increase, 2012 and the rest of the five-year planning period still projects to have serious deficits that are going to have to be addressed either by further tax increase and/or spending cuts.  Holding out hope that development is going to ride to the rescue in 2011 — which the Council seems to be counting on — is a pretty thin strand to grasp.  While we all hope that the economy is poised to truly turn around, the stark reality is that the last two economic recoveries have taken far longer than historical post-WWII trend to produce a return to “normal”.

The Council seemingly hasn’t learned from recent experience with the Street Reconstruction Program or Water Rates.  Kicking the can down the road doesn’t work.  With those programs, the Council waited and waited, then was forced to make dramatic changes (a tax increase for the former and a near-doubling of rates for the latter).   Thanks to the inaction of the Council to start addressing these structural issues with the 2011 budget, we’re potentially facing a much larger mess in 2012 and beyond.

When roughly 70% of the city general fund budget goes to personnel costs, you’re going to have to go there to get savings.  Everyone appreciates that Chaska has, by and large, excellent city staff who are smart, versatile, and dedicated.  But reality is reality.  You can’t just wave away (as Mayor Mark Windschitl did) the fact that private sector workers have seen dismal labor market conditions and homeowners are experiencing declining property values.  A one-year pay freeze for city employees would not be out of line given the current situation, and in fact, that would be far better than what many employees of other government agencies have been receiving.

It’s critical that Chaska’s financial house get put into order sooner rather than later.  In January, the city will unveil the results of the Downtown Master Plan.   First looks  for some of the ideas on critical downtown blocks were given to the Chaska Herald last week.  These ideas look promising, but they are not going to be free.  If revitalization of downtown is as important as everyone says it is, then money is going to have to be freed up for these efforts.  We’ve got to have the rest of the budget in line in order to be able to effectively address downtown (realizing that said funds will come from multiple sources).  Otherwise, all the hard work (and the $83,000 in consulting fees) will go up on the shelf, not to be used.

Truth in Taxation tonight

The Truth in Taxation meeting to discuss the city’s proposed increase in the property tax rate is tonight.  The General Fund presentation is online, while details for the other funds have not been posted.  A final vote on the city budget will be at the December 20 City Council meeting.

In September, the City Council approved a preliminary levy equal to that of last year, which effectively means that property taxes will be raised 6.7% to offset a similar decline in property valuations in 2011. 

Under the preliminary levy, the median homeowner in Chaska would see a decline in property taxes of $1 versus a decline of $30 if the tax rate were to stay the same.

Additionally, the plan called for the following cuts:

  • Do not hire a budget analyst and heavy equipment operator as originally planned
  • Delay purchases of a new siren for northern Chaska and additional snow removal equipment
  • Reduce the sealcoat and overlay portion of the street reconstruction programThe cuts and the tax hikes represent a combined $639,000, offsetting increases in personnel (1.5%) and operating expenses (2%).
  • Unfortunately, the City Council has not gone further and addressed additional expenses that should be looked at.  I would propose these additional measures, with the savings going to reduce the tax rate:

    • A one-year pay freeze for city employees.  This would be entirely appropriate, given the continued budget problems and the dismal conditions in the larger labor market — as most families have seen their wages frozen (or worse) in the current economy.  Many other cities have already taken this step.  Councilor Gino Businaro has been pushing for this, and we shall see if he votes against the budget again because it is not included.
    • Elimination of the downtown flower program and begin a transition away from city subsidies for “Concerts in the Park”, Taste of Chaska, and River City Days.  These are excellent opportunities for the Chaska business community to step up.  The goal should be for the city to eventually not have to subsidize these events at all, but the transition should happen over a three-year timeframe to allow organizations to fundraise to fill the void.
    • Voluntary pay cuts from the Mayor and Council:  Under Chaska statute, changes to the pay for the Mayor and Council wouldn’t take impact until 2013.  However, nothing prevents the Mayor and Council from voluntarily cutting their pay.  A 10% (or more) cut would be a sign of good faith, even if it wouldn’t have significant budget impact.

    Decision time on the city budget

    The Chaska City Council held a worksession on Monday, November 15 to discuss the final city budget.  As you may recall, the Council approved in September a preliminary levy equal to that of last year, which effectively means that property taxes will be raised 6.7% to offset a similar decline in property valuations in 2011. 

    Under the preliminary levy, the median homeowner in Chaska would see a decline in property taxes of $1 versus a decline of $30 if the tax rate were to stay the same.

    Additionally, the plan called for the following cuts:

  • Do not hire a budget analyst and heavy equipment operator as originally planned
  • Delay purchases of a new siren for northern Chaska and additional snow removal equipment
  • Reduce the sealcoat and overlay portion of the street reconstruction program
  • The cuts and the tax hikes represent a combined $639,000, offsetting increases in personnel (1.5%) and operating expenses (2%).

    As part of that meeting, the council also reviewed City Administrator Matt Podhradsky’s recommendations regarding cuts should the Council choose to keep the tax rate steady instead of increasing it.  Councilor Greg Boe had asked for this view last month (long after it had been called for by some members of the community).

    These cuts include:

    • Reduced or delayed expenditures for the street reconstruction program
    • Eliminate the downtown flower program
    • Eliminate the “Concerts in the Park”
    • Reduced support for the Fireman’s Park beach and outdoor ice rinks
    • Eliminate free services (such as police coverage, sanitation, and port-a-potties) for events like Taste of Chaska and River City Days

    Chaska Herald coverage of the worksession indicates that the Council was likely to stick with the preliminary levy.

    What’s not on the table for cuts, based on the preliminary levy and Podhradsky’s stable tax rate scenario:

    • City employee salaries:  slated for 1.5% increase.  Some union contracts (including the police contracts) have already been approved by the Council at that rate.
    • Cuts to core city services:  police, fire, etc.

    What’s your take?  Should we make these cuts, or increase taxes?  Should the things that are off the table be on the table?

    Math matters

    During Monday’s City Council meeting, City Administrator Matt Podhradsky was asked by Ward 2 Councilor Greg Boe what the median property tax would be if the tax rate were not increased.

    Let’s review the scenario in question.  In 2010, the median home value in Chaska was $216,216.  For 2011, they are anticipating a decrease in market value of 7.4%.  As such, the new median home value will be $200,216.  The current tax rate is 0.2189, and the new proposed tax rate is 0.2335.

    Firing up the handy-dandy Brick City Blog calculator, we see that the property tax on the median home in 2010 is $473.  For 2011 — using the reduced market value and the increased rate — the proposed property tax on the median home is $467, a reduction of $6.

    When asked by Boe what the property tax would be if the rate were not increased, Podhradsky answered it would be about $10 less, or $457.  But, that’s not correct.  In fact, if you multiply $200,216 by 0.2189, you get $438.

    I’m not attempting to imply that Podhradsky was trying to shade the truth here.  He was speaking off the top of his head.

    But people following the discussion (and those who read the Chaska Herald article that also re-prints the bad number) should be clear on what the true impact of this proposal is.  It’s not the difference between a $6 reduction in tax and a $16 reduction — it’s the difference between $6 and $35 for a $200,000 home.  And the more your home is worth, the bigger that gap gets.

    The tax rate increase will result in $300,000 more in revenue for the city than if they had left the rate where it was.  In these tough economic times, raising a regressive tax like the property tax should be the last resort.  It should be incumbent on the Council and staff to produce a budget scenario that includes no tax rate increase so that Chaska residents can weigh the trade-offs that would have to be made.

    [UPDATE 9/20]:  After reviewing my analysis and bringing it to the attention of the City Administrator, the Chaska Herald will be running a correction in this week’s paper.

    Show your work, part 2

    Remember all the talk we’ve heard in recent years about how the city of Chaska was going to do a better job of communicating with residents?

    The city of Chanhassen will be approving their preliminary tax levy on Monday, September 13 — the same day Chaska will be doing the same thing. Chanhassen has a 129-page document online showing their proposed budget including line-by-line detail. They evaluated three scenarios (a small increase, a no change scenario, and a small decrease). It’s been available on their website since August 18. The agenda and all the supporting documentation for their council meeting was posted by yesterday (some pieces were available last week).

    Here’s the link to their budget document.

    Here in Chaska, none of the above information has been posted. Trumpeting the fact that you signed up for Facebook is worse than irrelevant if you aren’t going to make the effort to truly communicate with people about the things that really matter.

    Special election approved by City Council

    The Chaska City Council voted 3-1 last night to approve a special election to replace resigned Mayor Gary Van Eyll.

    Councilors Greg Boe, Gino Businaro, and Rick Ford voted in favor of the election while Chris Schulz voted against the election.

    Thanks to the three councilors who did the right thing, and to everyone who made their voices heard in favor of the election.

    Let your voice be heard!

    Well, it may seem that the die has been cast based on the council’s worksession. However, let’s not roll over just yet. A couple of the councilors have indicated they haven’t received much feedback about the issue.
    Let’s make sure that they do get some feedback before the September 21 City Council meeting.

    Please e-mail all the councilors regarding your opinion in favor of the special election. Regardless of who you think should be the next mayor of Chaska, this is about allowing the all residents of Chaska — not four individuals — make the decision about the only city-wide elected office.

    gbusinaro@chaskamn.com

    Van Eyll resigns: What now?

    Chaska Mayor Gary Van Eyll announced , his resignation effective August 31 at Monday’s City Council work session.  Van Eyll, who was approaching the midpoint of his fourth term as Mayor, will be taking a position with the U.S. Census Bureau that requires him to give up public office.

    The City Council will formally act on Van Eyll’s resignation at their next meeting on August 31.  They have two options for filling the seat:

    1. The Council can appoint someone to the position.  Per Minnesota law, any position that has less than two years remaining on its term can be filled by appointment.
    2. The Council can choose to call a special election.  This would likely be held in the October/Novemebr timeframe.

    Considerable speculation has already begun regarding what the Council will do and who the new mayor will be.  Greg Boe’s blog seems to hint at an appointment (although he does point out that the Council has options), as Boe encourages people to advocate on the blog for who they think the right selection is.

    Some names bandied about are Ward 3 Councilor Chris Schulz, who will serve as Acting Mayor in Van Eyll’s absence.  Jay Rohe, who lost to Van Eyll in the 2008 election, will receive support from a segment of the population.  It’s also unclear if Councilors Boe, Rick Ford, or Gino Businaro have interest in the job.

    If one of the City Councilors is selected or elected to the position, then the Council has the same set of options for filling that vacancy.

    I think a special election is the way to go. I realize this has two significant downsides: the expense of holding the election and leaving the council with only four voting members for a couple of months. However, what is easy and cheap isn’t always what is right.

    The mayor position is the only city-wide elected office. All residents should have a say on who the mayor is. Promoting a city council member who has only been voted on by one-fourth of the city (or worse, someone who isn’t even holding an elected office at the moment) violates that principle.

    Additionally, in municipal positions, incumbency is major advantage come re-election time. If the council appoints someone, they are giving that person a significant leg up in the 2010 mayor’s race.

    The potential candidates listed above (and others not mentioned) should have the opportunity to make their case to the citizens of Chaska, not just the four members of the City Council.


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