Recently many News-Herald readers may have noticed that the city set its preliminary levy at a 12.21 percent increase, which could be a troubling number considering that the levy hasn’t been raised significantly for the past four or so years. I would like to take a second to go over the city’s process for setting a budget and thus a levy and try to give you a clearer picture of where the city stands right now financially.
The city has several departments, many of which are break-even endeavors or cashpositive. Examples of these would be the public utilities, a nonprofit that charges fees for the use of their services, the park department and liquor store that make money for the city through the services they provide for a fee. Other departments cost the city money either because they are mandated or because the residents of the city have agreed that the services they provide are worth the expense. Examples of these are the city administration, the library. Each of these departments proposes a budget to the city council, which then considers and makes requests of the different departments to amend that budget.
I have been very impressed with how frugally our city runs its departments. There is very little extra money in the budget with expenditures being directly linked to projects and personnel.
So, why the increase?
The city employs 20 full-time, 14 part-time, roughly 16 seasonal, and 25 volunteer firefighters, all of whom need to be covered by certain mandated insurances and protections, which cost some money. All of our full- and heavy part-time workers are union members (excluding department heads) and thus are subject to negotiated union contract rates, which are re-negotiated every several years, this year being one of them.
The majority of the increase has been the cost of living increase we calculated (assuming an increase due to the union negotiations) and staffing increases from identified and requested staff shortages from the department heads. This is tricky because we need people working for the city to run and we need to provide many services that other parts of the state can share.
Thus the 12.21 percent increase, but it can and likely will go down before we finalize it later in the year. There are still several conversations that need to happen with the county and other agencies to see what their participation will be, which will directly impact the levy. Likewise the council has another work session scheduled to go over the numbers one more time to make sure that we have trimmed all of the fat we can so that we will have a final number that accurately reflects the community’s desires for services and the expense of those services.
As always, if you have any questions about the budget process, please let me know and I would love to have that conversation with you.
Jay Arrowsmith DeCoux
Grand Marais Mayor
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